Mr Jon Corzine, co-chairman and co-chief executive officer of Goldman Sachs, yesterday told the firm's 11,000 full-time employees that the listing of Wall Street's largest remaining partnership on the stock market would be discussed at a meeting of partners in New York on June 12th.
The former EU Commissioner, Mr Peter Sutherland, will gain substantially if the flotation goes ahead. Mr Sutherland is currently chairman and managing director of Goldman Sachs International and as one of the most senior partners can expect to add many millions of pounds to his fortune. Mr Sutherland, the former head of the World Trade Organisation who also served as Attorney General, became a partner in 1995.
In a speech accessed by employees through voice-mail, Mr Corzine said "consideration of this issue will quickly come to a head". This was interpreted as an indication that a vote on taking the firm public - which could value Goldmans at up to $30 billion (£21.2 billion) - was likely to take place at or soon after the June 12th meeting. He told staff: "It's going to be decided by the entire partnership".
Mr Corzine added that an initial public offering "had been looked at many times over 25 years, under vastly disparate circumstances", noting that it had often been considered when the firm was in a position of relative weakness.
It was last considered in 1996 but abandoned before a formal vote by partners. Now, Mr Corzine said, the firm will be looking at the option from a position of strength, which he described as "infinitely preferable", highlighting the absence of "business or leadership stress." He also exhorted staff to "be patient".
According to people close to the firm, there was no decision at a senior management meeting last weekend on what form an IPO would take, if approved. Last month, estimates suggested that an IPO would value the firm at between $22 billion and $25 billion, but some partners now think it could be worth as much as $30 billion, although it is unlikely that the whole firm would be floated in one offering.
If the consensus at the June 12th meeting is in favour of an IPO, the vote could be immediate, with the offering scheduled for the autumn. But some within the firm said a vote could come later. A partnership meeting is expected to take place in October, providing another potential forum for a vote. There are still "a bunch of possible outcomes," said one Goldman employee.
Sentiment in favour of flotation is believed to have increased since it was last raised in 1996, as a result of the quickening pace of consolidation in the financial services industry, the firm's recent strong profitability and high valuations on the US stock market. However, there is still some opposition, particularly outside the US.
"There could be an international split on this. We see this as coming predominantly from America," said one London-based banker.
"This is a top of the market phenomenon," said one executive just below partnership level. "My reason for joining was to make partnership, but this would stymie that."
Mr Corzine confirmed the appointment of Mr Hank Paulson as co-chairman and co-chief executive officer. He has been president and chief operating officer of the firm since 1994. In a statement, Goldmans said the move "continues the long tradition of joint leadership based upon shared strategic vision and complementary personal talents and experience".
