Sutherland major gainer from Goldman Sachs listing

Mr Peter Sutherland is among 221 partners in Goldman Sachs' who will own nearly half the company following the investment bank's initial public offering, due in the next three months.

Each partner's holding will depend on the amount of capital invested in the firm, but stakes will range from about $20 million for junior partners to about $200 million for senior partners. Partners will not be able to sell shares for 3-5 years.

Among the major beneficiaries will be Mr Sutherland, the former GATT director general and EU Commissioner, although the precise value of his or any other partner's stake is impossible to calculate from the information filed.

Mr Sutherland is chairman of Goldman Sachs International and as a senior partner will benefit from getting ownership of a very valuable stake. However, the fact that he has been with Goldman Sachs for a relatively short period of just over three and a half years is likely to mean that he will not be among the top earners, with stakes valued at $200 million.

Goldman filed a draft prospectus for the offering with the Securities and Exchange Commission yesterday, and reported record first-quarter earnings of $1.2 billion, up from $1 billion a year ago before payments to partners.

An attempt to take the firm public was derailed in September due to adverse market conditions after Russia's debt default and the near-demise of hedge fund Long-Term Capital Management.

Mr Jon Corzine, co-chairman, will step down from that role immediately prior to the IPO and leave the firm shortly afterwards. Mr Corzine lost out in a power struggle this year and resigned his position as co-chief executive officer. Of the remaining 51 per cent that will not be owned by partners, about 20 per cent - worth an estimated $4.5 billion - will be divided among about 13,000 full-time staff, who will receive between $10,000 and more than $1 million.

Goldman filed yesterday with the Securities and Exchange Commission for an offering of 60 million shares, expected to be priced at $40-50 per share. The IPO will, therefore, be worth between $2.4 and $3 billion, if it is priced within this range. This accounts for about 13 per cent of the company on a fully diluted basis. There will be 467 million shares, including restricted stock, outstanding following the IPO.

If the IPO is priced at $45 per share, this would suggest a market capitalisation of $21 billion, but analysts say the market valuation is likely to be close to $24 billion.