Blackstone pulled out of investment over political concerns

US private equity firm Blackstone (BX.NYSE) withdrew its investment in a Chinese agricultural firm after concerns that price rises could land the firm in political hot water, the Financial Times reported, citing three unnamed sources. Blackstone paid US$194 million for 10% of Dili, a Shandong vegetable trader, as part of a five-member consortium in March 2010. The company is said to have pulled out of Dili in the first quarter of 2011, as officials from the Chinese company argued that Blackstone’s presence would make price rises more politically complicated. The move came just weeks before Unilever (UN.NYSE, ULVR.LSE) was fined for announcing future price rises prompted by inflation. Controlling inflation, which hit 6.4% year-on-year in June, is considered a top priority for Beijing, which occasionally exerts political pressure on retailers to prevent them from raising prices.