Deals and IPOs

Blackstone on WhatsApp deal: 'Beauty in eye of beholder'

'Beauty in eye of beholder': Blackstone on FB's WhatsApp buy

The huge price tag for Facebook's acquisition of messaging service WhatsApp is hard to justify, but there is clearly value in the app's 450 million users, Blackstone's John Studzinski told CNBC on Friday.

The senior managing director and global head of Blackstone Advisory Partners pointed out that "beauty is in the eye of the beholder" and Facebook $16 billion acquisition of WhatsApp deal was all down to chief executive Mark Zuckerberg's vision.

"That expression, beauty is in the eye of the beholder. You probably have to go back to some aspect of that. I can't justify it but then again I don't have Mark Zuckerberg's vision, I don't have his check book," said Studzinski.

(Read more: WPP CEO: Facebook's huge WhatsApp acquisition 'potty')

"There is clearly value in those 450 million people, it's a question of what value you put on it and what you are going to do with it," he said.

Facebook bought messaging start-up WhatsApp last month for a staggering $16 billion, plus another $3 billion in restricted stock options. Many investors and analysts were unimpressed with the deal and Facebook's share price slipped almost 4 percent at the time.

Studzinski said he expects to see a lot more merger and acquisition (M&A) activity in big American companies, particularly in tech firms as many of them have cash piles to spend.

(Read more: Facebook buys WhatsApp: A desperate move?)

"Remember there is a lot of big American companies that have a lot cash trapped outside of the U.S. and who don't want to bring it back to the U.S. because they don't want to lose 40 percent of the value of that cash," he said.

"You are going to see a step up in the use of that cash for M&A I think," he added.

Speaking on Blackstone's recent deal with luxury fashion brand Versace, where the group agreed to buy a fifth of the family firm, Studzinski described the brand as having "enormous potential".

The fashion house sold a 20 percent stake to Blackstone for 210 million euros ($287 million), aiming to fund new shops and build on a recent recovery in sales before an eventual stock market listing.

(Read more: Blackstone agrees to buy 20% stake in Versace)

The brand returned to profit in 2011, but has lacked the cash to expand rapidly in fast-growing markets overseas.

"Versace is in the same category as Gucci – the potential to have a much bigger Versace in terms of revenue in terms of profit in terms of global scope, Blackstone believes is there," he added.

Studinski also dismissed any rumors the private equity group had plans to up the 20 percent stake in the company.

"I think you should just assume that what is in the public domain is the state of our current thinking," he said.

By CNBC's Jenny Cosgrave: Follow her onTwitter @jenny_cosgrave

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