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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 presses harder into alternative assets and makes its first foray into financial information provision, said people briefed about the matter.
The $10.5tn asset manager beat S&P Global and Bloomberg to acquire Preqin in the latest of a series of deals for specialised data providers, they added. The deal is expected to be announced as soon as Monday.
Dealmaking for data providers has been rampant in recent years as private equity firms, asset managers and larger information businesses race to serve investors who want access to granular information about all corners of the financial markets, including private equity, infrastructure and hedge funds.
Other data providers to change hands in recent years include S&P Global’s $44bn takeover of IHS Markit in 2020 and the London Stock Exchange Group’s $27bn acquisition of Refinitiv. 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 around $1.3bn.
The transaction marks BlackRock’s second good-sized acquisition focused on private markets in six months. It struck a $12.5bn deal to buy Global Infrastructure Partners in January. That acquisition is on track to close in the third quarter.
The Financial Times first reported that Preqin was for sale and BlackRock was a bidder.
The Preqin deal sits at the nexus of two areas that BlackRock chief executive Larry Fink has cited as crucial to the money manager’s continued growth: alternative assets and BlackRock’s technology arm, which provides risk and data management services to both public and private market asset managers.
Founded 20 years ago, Preqin specialises in tracking the performance of private equity and hedge funds. It now has around 200,000 users and supplies data on 60,000 fund managers and 30,000 investors. Its revenue has grown more than 20 per cent annually over the past three years. The company’s growth has been turbocharged by the long boom in private capital, which is expected to reach more than $40tn in assets by the end of the decade.
BlackRock would be paying 13 times Preqin’s expected 2024 revenue of $240mn.
The company was founded by Mark O’Hare, who is expected to become a vice-chair at BlackRock. It had also attracted interest from private equity buyers but ultimately opted to be acquired by a strategic rival.
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 transaction is expected to close later this year.