Reports say that BlackRock is almost done with a deal to buy New York investment company HPS Investment Partners for $12 billion. This would put BlackRock at the top of the more than $1.6-trillion private credit market.
Bloomberg reported that people familiar with the issue said HPS and BlackRock have agreed on the main terms of the cash and shares deal and could make an announcement early this week.
BlackRock BLK 0.33%, which is already the biggest asset manager in the world, would get an extra $148 billion in assets when the deal is done. This would bring its total assets under management (AUM) to $11.5 trillion, which would put it in the lead in the private credit market.
HPS was started by CEO Scott Kapnick, who used to be the head of Goldman Sachs’ investment banking business. It is now one of the biggest private credit providers in the world, with assets worth $123 billion in private credit.
Information from Prequin shows that the private credit market is now worth $1.62 trillion. This means that the market’s value has grown more than three times in the last ten years.
Any purchase of HPS would be the latest in a string of purchases made by BlackRock. In October, it paid $12.5 billion for Global Infrastructure Partners, and in July, it announced that it would pay £2.5 billion ($3.2 billion) for Prequin.
The Financial Times reported that BlackRock’s alternative assets portfolio would grow to more than $500 billion. The story said that the asset manager already manages $450 billion in alternative assets, which is more than it had before it bought GIP.
It was announced earlier this year that HPS was going to go public. The investment fund has already put in place plans for a $8 billion IPO in the U.S. at the end of 2023.
