BlackRock agrees to buy Global Infrastructure Partners, posts Q4 AUM beat

Investing.com -- BlackRock (NYSE:BLK) has agreed to purchase Global Infrastructure Partners in a $12.5 billion cash-and-stock deal that will create a multi-asset class investing giant.

The deal will see BlackRock acquire GIP for $3 billion in cash and approximately 12 million shares of BlackRock's common stock, forming a group with combined assets under management of over $150 billion. Approximately 30% of the total transaction, all in stock, will be deferred and is expected to be issued in roughly five years, "subject to the satisfaction of certain post-closing events," BlackRock noted.

New York-based BlackRock said it intends to to fund the cash portion of the agreement through $3B of additional debt, adding that this is not predicted to "meaningfully change" its leverage profile.

The deal, which still requires regulatory approval, is seen closing in the third quarter of this year.

"[O]ur acquisition of GIP will propel our leadership in the fast-growing market for hard-asset infrastructure," said BlackRock Chairman Larry Fink in a statement.

The move comes as BlackRock, the world's largest money manager, reportedly looks to expand its presence in alternative assets. The company said that the combination with GIP will give clients "the benefits of broader origination and business improvement capabilities."

GIP has over $100B in assets under management (AUM), including the Port of Melbourne, Gatwick airport in London, and the Suez water group.

Elsewhere on Friday, BlackRock posted fourth-quarter AUM and adjusted per share earnings that both beat average analyst expectations. A recent market rally driven by hopes for a soft landing in the U.S. -- a scenario in which the Federal Reserve manages to defeat inflation without sparking a broader economic meltdown -- boosted the firm's performance during the period.