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Goldman Sachs Group, Inc. The
85 Broad Street, New York, NY 10004 * (212) 902-1000
Business Description The company is a leading global investment banking and securities firm with three principal business lines: Investment Banking, Trading and Principal Investments and Asset Management and Securities Services.
Offering
Information

Company has
gone public

Trading As  GS (NYSE) Industry  Financial (SIC 6211)
Type of Stock Offered  Common Shares Filing Date  03/16/1999
Domestic Shares Offered  48,000,000 Offer Date  05/03/1999
Foreign Shares Offered  12,000,000 Filing Range  $45.00 - $55.00
Company Shares  42,000,000 Offer Price  $53.00
Selling Shrhldrs Shares  18,000,000 Gross Spread  $2.250
Gross Proceeds  $3,180,000,000 Selling  $1.350
Expenses  - - Reallowance  $0.100
Post-IPO Shares  467,709,041 Employees  14170
Primary
Underwriting
Group
Underwriter NameParticipationUnderwriter Phone
Goldman, Sachs & Co. Lead Manager (212) 902-5959
Bear, Stearns & Co. Inc. Co-manager (212) 272-4850
CS First Boston Co-manager (212) 325-2000
Donaldson, Lufkin & Jenrette Securities Corp. Co-manager (212) 371-0641
J.P. Morgan Securities Inc. Co-manager (212) 648-0517
Lehman Brothers Incorporated Co-manager (212) 526-8100
Merrill Lynch & Co. Co-manager (212) 449-4600
Morgan Stanley Dean Witter Discover & Co. Co-manager (212) 761-5900
PaineWebber Incorporated Co-manager (212) 713-2626
Prudential Securities Incorporated Co-manager (212) 778-5420
Salomon Smith Barney Co-manager (212) 723-7300
Sanford C. Bernstein Co-manager (212) 486-5800
Schroder Wertheim & Company, Incorporated Co-manager (212) 492-6900
Income
Statement
and
Cash Flow
Summary
  Prior
Audited
Income
Latest
Unaudited
Income
  Full Year Audited Figures - - Months Ending
Figures in U.S. millions except per share data   11/30/1995 11/30/1996 11/30/1997 11/30/1998    
Revenues   - 14,324.000 17,289.000 20,433.000 22,478.000 - -
Income from Oper.   - - - - - - -
Net Income   - 1,348.000 2,399.000 2,746.000 2,428.000 - -
E.P.S   - - - - - - -
Revenue Growth (%)      - 20.70 18.18 10.008   -
Net Income Growth (%)      - 77.97 14.46 -11.58   -
Oper. Profit Margin (%)    - - - - - - -
Net Profit Margin (%)    - 9.41 13.88 13.44 10.80 - -
Cash Flow - Oper.     62.00 - -
Cash Flow - Inv.     -656.00 - -
Cash Flow - Fin.     2,102.00 - -
Balance Sheet
Summary
and
Financial
Ratios
Balance sheet as of: 11/30/1998 Financial Ratios
Total Assets    217,380.00 Current Assets    - Current Ratio    -
Total Liab.    211,070.00 Current Liab.    - Debt Ratio    97.10%
Total Equity    6,310.00 Working Cap.    - Debt to Equity Ratio    33.45
Cash    2,836.00    Return on Assets   1.12%
Use Of
Proceeds
The proceeds from the proposed offering will be used to enhance the capital structure of the firm.
Legal Counsel
Registrar
Auditor
Issuer's Law Firm  Sullivan & Cromwell
Bank's Law Firm  Cleary, Gottlieb, Steen & Hamilton
Registrar/Transfer Agent  ChaseMellon Shareholder Services, L.L.C.
Auditor  Pricewaterhouse Coopers LLC
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Industry
Competition
The financial services industry -- and all of our businesses -- are intensely competitive, and we expect them to remain so. Our competitors are other brokers and dealers, investment banking firms, insurance companies, investment advisors, mutual funds, hedge funds, commercial banks and merchant banks. We compete with some of our competitors globally and with some others on a regional, product or niche basis. We compete on the basis of a number of factors, including transaction execution, our products and services, innovation, reputation and price. Competition is also intense for the attraction and retention of qualified employees. Our ability to continue to compete effectively in our businesses will depend upon our ability to attract new employees and retain and motivate our existing employees. In recent years there has been substantial consolidation and convergence among companies in the financial services industry. In particular, a number of large commercial banks, insurance companies and other broad-based financial services firms have established or acquired broker-dealers or have merged with other financial institutions. Many of these firms have the ability to offer a wide range of products, from loans, deposit-taking and insurance to brokerage, asset management and investment banking services, which may enhance their competitive position. They also have the ability to support investment banking and securities products with commercial banking, insurance and other financial services revenues in an effort to gain market share, which could result in pricing pressure in our businesses. This trend toward consolidation and convergence has significantly increased the capital base and geographic reach of our competitors. This trend has also hastened the globalization of the securities and other financial services markets. As a result, we have had to commit capital to support our international operations and to execute large global transactions. We believe that some of our most significant challenges and opportunities will arise outside the United States. In order to take advantage of these opportunities, we will have to compete successfully with financial institutions based in important non-U.S. markets, particularly in Europe. Certain of these institutions are larger, better capitalized and have a stronger local presence and a longer operating history in these markets. We have experienced intense price competition in certain businesses in recent years. For example, equity and debt underwriting discounts have been under pressure for a number of years and the ability to execute trades electronically, through the Internet and other alternative trading systems may increase the pressure on trading commissions. It appears that this trend toward alternative trading systems will continue and perhaps accelerate. Similarly, underwriting spreads in Latin American and other privatizations have been subject to considerable pressure in the last year. We believe that we may experience pricing pressures in these and other areas in the future as some of our competitors seek to obtain market share by reducing prices.
Business
Plan
Our strategy is to grow our three core businesses -- Investment Banking, Trading and Principal Investments, and Asset Management and Securities Services -- in markets throughout the world. Our leadership position in investment banking provides us with access to governments, financial institutions and corporate clients globally. Trading and principal investing has been an important part of our culture and earnings, and we remain committed to these businesses irrespective of their volatility. Managing wealth is one of the fastest growing segments of the financial services industry and we are positioning our asset management and securities services businesses to take advantage of that growth. Our assets under supervision, for example, have grown from $92.7 billion as of the end of fiscal 1994 to $336.8 billion as of the end of fiscal 1998, representing a compound annual growth rate of 38%.
Principal
Shareholders
Name of Shareholder% Owned
Before
% Owned
After
Sumitomo Bank Capital Markets, Inc. 7.50 4.90
Kamehameha Activities Association 7.40 4.80
Note: represents ownership of 5% or more prior to the offering.
Executive
Officers
and
Directors
Officer NameOfficer TitleAge
David A. Viniar C.F.O. 43
Barry L. Zubrow Chief Administrative Officer 46
Leslie M. Tortora Chief Information Officer 42
Robin Neustein Chief of Staff 45
John L. Weinberg Director 74
Robert J. Hurst Director and Vice Chairman 53
Henry M. Paulson, Jr. Director, Chairman and Chief Executive Officer 52
John L. Thornton Director, President and Co-Chief Operating Officer 45
John A. Thain Director, President and Co-Chief Operating Officer 43
Robert J. Katz General Counsel 51
Gregory K. Palm General Counsel 50

Last updated: 09/29/1999 3:51:24 AM
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