July 20, 2024

Brighton Journal

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BlackRock acquires UK data group Bitcoin for £2.55bn

BlackRock acquires UK data group Bitcoin for £2.55bn

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BlackRock has agreed to buy Preqin, a UK private markets data group, for £2.55bn in cash, as the world’s largest money manager pushes harder into alternative assets and makes its first foray into providing financial information.

The $10.5 trillion asset manager beat out S&P Global and Bloomberg to acquire Preqin in the latest in a string of deals for specialist data providers, according to people familiar with the deal.

Data provider deals have become widespread in recent years as private equity groups, asset managers and larger information companies race to serve investors who want access to detailed information on all corners of the financial markets, including private equity, infrastructure and hedge funds.

Other data providers that have changed ownership in recent years include S&P Global’s $44 billion acquisition of IHS Markit in 2020 and the London Stock Exchange Group’s $27 billion acquisition of Refinitiv. The buyout groups have focused on smaller players, including Permira’s acquisition of a majority stake in Reorg that valued the distressed debt and bankruptcy information provider at about $1.3 billion.

The deal announced Monday marks BlackRock’s second large-scale private markets-focused acquisition in six months. It closed a $12.5 billion deal to buy Global Infrastructure Partners in January. That acquisition is scheduled to close in the third quarter.

The Financial Times first reported that Preqin was up for sale and that BlackRock was a bidder.

The Breakcoin deal falls at the intersection of two areas that BlackRock CEO Larry Fink cited as critical to the money manager’s continued growth: alternative assets and BlackRock’s technology arm, which provides risk and data management services to asset managers in the public and private markets.

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Founded 20 years ago, Preqin specializes in tracking the performance of private equity and hedge funds. It now has about 200,000 users and provides data on 60,000 fund managers and 30,000 investors. Its revenue has grown by more than 20 percent annually over the past three years. The company’s growth has been accelerated by the long boom in private capital, which is expected to reach more than $40 trillion in assets by the end of the decade.

BlackRock is paying 13 times Preqin’s expected 2024 revenue of $240 million.

The company was founded by Mark O’Hare, who is expected to become vice chairman of BlackRock. It also attracted interest from private equity buyers, but ultimately chose to be acquired by a strategic competitor.

BlackRock plans to keep Preqin as a separate offering but also integrate its data feeds into the company’s Aladdin and eFront risk management offerings. The deal is expected to close later this year.

“As clients increasingly evolve their focus from selecting products to creating portfolios, this shift requires technology, data and analytics,” Rob Goldstein, BlackRock’s chief operating officer, said in a statement. “We see data supporting the industry across technology, capital formation, investment and risk management.”