BlackRock's deal with HPS Investment Partners boosts private market AUM by 40% and fees by 35%
BlackRock has announced plans to acquire HPS Investment Partners for US$12bn in stock, a move aimed at strengthening its presence in the growing private credit market.
CNBC reports that the private credit space is gaining significant momentum as the deal, expected to close in mid-2025, was revealed.
The acquisition will create an integrated private credit franchise managing approximately US$220bn in assets.
BlackRock’s CEO, Larry Fink, highlighted the strategic importance of the deal, stating, “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.”
HPS currently manages about US$148bn in assets, while BlackRock oversees US$11.5tn as of the third quarter. The transaction is expected to boost BlackRock’s private market assets under management (AUM) by 40 percent and increase management fees by about 35 percent.
The private credit market continues to thrive, with comparable publicly traded firms like Blue Owl Capital and Ares achieving gains of 54.6 percent and 46 percent, respectively, in 2024.
In comparison, BlackRock has gained 25.7 percent year-to-date.
Sources cited by CNBC revealed that HPS initially considered going public, a move that captured BlackRock’s interest as it seeks to expand its alternative assets business.
Earlier this year, BlackRock announced acquisitions of Global Infrastructure Partners and private market data provider Preqin for US$12.5bn and US$3.2bn, respectively.