BlackRock Inc.
BLK,
said Friday it has entered an agreement to acquire Global Infrastructure Partners, or GIP, an independent infrastructure fund manager, for $3 billion in cash and about 12 million shares. The infrastructure market is valued at $1 trillio today and expected to be one of the fastest growing ones in the years ahead, BlackRock said in a statement. “A number of long-term structural trends support an acceleration in infrastructure investment,” said the asset manager. “These include increasing global demand for upgraded digital infrastructure like fiber broadband, cell towers and data centers; renewed investment in logistical hubs such as airports, railroads and shipping ports as supply chains are rewired; and a movement toward decarbonization and energy security in many parts of the world.” GIP, which was founded in 2006, has more than $100 billion in assets under management and a strong reputation for driving improvements in portfolio companies, said the statement. The company has about 400 employees and more than 40 portfolio companies that generate more than $75 billion in annual revenue and employ about 115,000 people around the world. BlackRock intends to fund the cash part of the deal by raising about $3 billion of additional debt. The deal is expected to modestly boost adjusted EPS and operating margin in the first full year after close, which is expected in the third quarter. BlackRock’s stock is up 5% in the last 12 months, while the S&P 500
SPX,
has gained 20%.
