World’s largest asset manager BlackRock Inc. (BLK) announced that it will be acquiring investment manager service provider Aperio Group LLC for $1.5 billion. BlackRock will be purchasing Aperio from its current owner Golden Gate Capital, a private equity firm.
Some employees of Aperio also own notable stake in the company the purchase transaction will be an all cash one. BlackRock is optimistic this acquisition will boost its Separately Managed Account (SMA) assets by over $160 million which translates to about 30% increase.
The company is intending to close the deal during the first quarter of next year, BlackRock says it will use cash from existing corporate liquidity to finance the deal further adding the deal is minimally dilutive to its earnings per share hence it won’t be dilutive on a cash basis.
Following closure of the deal, BlackRock will run Aperio independently but its managerial chain of command will include a blended team from BlackRock’s U.S. Wealth Advisory business.