In a landmark move that reshapes the private credit landscape, BlackRock, the world’s largest asset manager, has struck a deal to acquire HPS Investment Partners for £9.5 billion ($12 billion), marking a significant expansion into the flourishing private investments sector.
The transaction structure reveals BlackRock’s strategic approach, with £7.4 billion ($9.3 billion) to be paid in stock at closing, alongside a future commitment of 2.9 million shares, valued at approximately £2.4 billion ($3 billion), contingent upon HPS meeting specific financial benchmarks over a five-year period.
Larry Fink, BlackRock’s chief executive, emphasised the strategic importance of the acquisition, stating it represents the next evolutionary step in the firm’s private markets capabilities. The deal follows BlackRock’s recent £10 billion ($12.5 billion) acquisition of Global Infrastructure Partners and its agreed purchase of Preqin, a British private markets data group, for £2.55 billion.
HPS, established in 2007 by former Goldman Sachs executive Scott Kapnick alongside colleagues Scot French and Michael Patterson, has grown substantially since its management buyout from JPMorgan Chase in 2016. The firm currently manages £118 billion ($148 billion) in assets, specialising in providing capital to businesses requiring urgent funding or approaching restructuring.
The merger will significantly boost BlackRock’s alternative assets portfolio to nearly £478 billion ($600 billion), positioning it as a dominant force in the industry. The integration plans include merging HPS with BlackRock’s existing private credit division to create a comprehensive private financing solutions business, particularly targeting insurance company clients.
Market observers note the timing of this acquisition coincides with the rapid expansion of private credit markets, as traditional banks continue to retreat from certain lending activities. The deal is expected to complete in 2025, with HPS’s founding partners joining BlackRock’s executive committee and Kapnick securing an observer position on BlackRock’s board of directors.
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