BlackRock, an asset manager, closed a deal to acquire HPS Investment Partners in a transaction valued at over $12 billion, according to the Wall Street Journal.
This acquisition aligns with BlackRock’s strategy to expand in private markets, which CEO Larry Fink has prioritized. It follows the firm’s $12.5 billion purchase of Global Infrastructure Partners in October and its $3.2 billion acquisition of data provider Preqin earlier this year, Market Watch reported.
The private credit market, which has more than tripled in value over the past decade, is now worth $1.62 trillion, Market Watch noted, citing data from Preqin. This growth has been fueled by demand from institutional investors like pension funds, insurers and sovereign wealth funds seeking higher returns outside of traditional public markets.
By acquiring HPS, BlackRock aims to position itself to compete more directly with major players like KKR and Apollo Global Management in the private assets arena, Bloomberg reported.
The HPS deal marks BlackRock’s second major acquisition in alternative asset management within a year. The private credit sector’s high-fee structure offers an attractive revenue stream, particularly as investors increasingly shift toward low-cost index funds and ETFs in public markets, Bloomberg reported.
This deal also reflects a broader industry trend as asset managers adapt to the growing appetite for private market investments. HPS’ integration into BlackRock’s portfolio could pave the way for innovative products that tie private assets to exchange-traded funds, leveraging the firm’s scale to meet evolving investor demands.
