In this article, BlackRock announced on Tuesday its plan to purchase HPS Investment Partners for $12 billion in stock. The acquisition aims to expand the world’s largest asset manager’s presence in the private credit sector, which is currently in high demand.
BlackRock’s CEO Larry Fink stated, “We have always sought to position ourselves ahead of our clients’ needs. Together with the scale, capabilities, and expertise of the HPS team, BlackRock will deliver clients solutions that seamlessly blend public and private.”
The deal is anticipated to be finalized by mid-2025, coinciding with a period of growth in the private credit industry. Comparable publicly traded companies like Blue Owl Capital and Ares have seen increases of 54.6% and 46% in 2024, surpassing BlackRock’s year-to-date gain of 25.7%.
Upon completion, the transaction will establish “an integrated private credit franchise” with approximately $220 billion in assets, combining HPS’s $148 billion in managed assets with BlackRock’s $11.5 trillion as of the third quarter.
Sources revealed that HPS initially considered going public, attracting BlackRock’s interest as it seeks to expand its alternative assets business. Earlier this year, BlackRock had announced acquisitions of Global Infrastructure Partners and private market data provider Preqin for $12.5 billion and $3.2 billion, respectively.
The acquisition is projected to increase BlackRock’s private market assets under management (AUM) and management fees by around 40% and 35%, respectively.
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