BlackRock (BLK.US) takes another step towards the private equity market.
Recently, BlackRock announced a cash acquisition of Preqin for £ 2.55 billion (approximately RMB 23.5 billion).
BlackRock has launched two large-scale acquisitions targeting the private equity market within the year.
In January of this year, BlackRock announced the acquisition of Global Infrastructure Partners, the world's largest independent infrastructure investment management company, for approximately $12.5 billion in cash and stock. For BlackRock, these two acquisition actions have supplemented its own business and investment technology data support.
The acquisition of Preqin is aimed at private equity indexing.
Preqin is a well-known data solution provider in the private equity market, specializing in tracking private equity, hedge funds, and other fields. Headquartered in London, it covers 190000 funds, 60000 fund managers, and 30000 private equity market investors worldwide, with over 200000 users.
Why acquire Preqin? Larry Fink, CEO of BlackRock, stated that through this acquisition, BlackRock is able to apply an exponential model to the rapidly growing private equity market. The rise of data, benchmark indices, and risk analysis software has changed the public offering market, making it more open to investors and increasing transparency in performance and return drivers. The public offering market has proven to create enormous value for customers and shareholders, and indices have become the representative language of the public offering market. We envision introducing the principle of indices, even iShares (BlackRock's ETF brand), into the private offering market. Our goal is to achieve this in private equity markets where data, analysis, and index businesses are far less mature than public offerings.
Indexing and data will ultimately drive the popularization of all alternative investments. After the acquisition is completed, BlackRock can leverage data and analysis to increase customer access to private equity assets in the coming years. This acquisition also enhances BlackRock's risk management capabilities in its technology department, thereby supporting the company's continued growth in the future.
According to media reports, BlackRock's acquisition of Preqin is expected to be completed before the end of the year and still requires regulatory and other necessary approvals. BlackRock plans to retain Preqin as a standalone product and integrate data feeds into its Aladdin platform. The Aladdin platform is BlackRock's core product, which was developed by BlackRock in the 1980s as an integrated asset management platform for controlling investment risks and optimizing asset allocation.
Sudhir Nair, Global Head of Aladdin Platform, stated that working with Preqin can make it easier for private equity investors to enter, while also establishing a platform for investors and fund managers to connect more closely. Enable the Aladdin platform to bridge the transparency gap between the public and private markets through data.
BlackRock predicts that the private equity market is the fastest-growing part of global asset management, and by 2030, the size of alternative assets will reach nearly $40 trillion, leading to an increasing demand for standardized data in the market. It is expected that the market size for related data demand will increase from the current $8 billion to $18 billion by 2030.