BlackRock has announced the acquisition of HPS Investment Partners for approximately $12 billion, which will enhance its position in the private credit market.

Acquisition Details

The deal is structured as a share transaction and will increase BlackRock's assets under management in private markets by 40% and management fees by 35%.

The founding team of HPS will continue to lead a newly formed business unit within BlackRock focused on private financing solutions.

Position in the Industry

This acquisition positions BlackRock among the top five players in the private credit industry, with an estimated $220 billion in assets under management.

Expected Timeline and Financial Structure

The deal is expected to close in the middle of next year, with a portion of the purchase price contingent on performance metrics over the subsequent five years.

The financial structure of the acquisition includes a retention package of up to $675 million for HPS employees and the potential refinancing or cash payment of approximately $400 million in existing HPS debt.

Previous Investment in Alternative Assets

This acquisition follows BlackRock's earlier investment in alternative assets, specifically its $12.5 billion purchase of Global Infrastructure Partners.