"BlackRock buys Nigerian infrastructure firm GIP for $12.5 billion in major alternatives push"

" BlackRock buys Nigerian infrastructure firm GIP for $12.5 billion in major alternatives push \r\n\r\nBlackRock Inc. agreed to buy Adebayo Ogunlesi\u2019s Global Infrastructure Partners for about $12.5 billion, vaulting the world\u2019s biggest money manager into the top ranks of investors that make long-term bets on energy, transportation and digital infrastructure.\r\n\r\nBlackRock will pay $3 billion of cash and about 12 million shares, worth about $9.5 billion at Thursday\u2019s close, and the deal is expected to close in the third quarter. Ogunlesi, a former Credit Suisse executive who\u2019s GIP\u2019s chairman and chief executive officer, will join BlackRock\u2019s board and global executive committee.\r\n\r\nThe acquisition of GIP, which manages $100 billion, is the biggest deal in more than a decade for BlackRock and a major step by CEO Larry Fink to transform the firm into a key player in the rapidly growing market for private and alternative assets.\r\n\r\n\u201cThe unprecedented need for new infrastructure \u2013 for digital infrastructure, for upgraded logistics hubs, and for decarbonization and energy security \u2013 coupled with record high government deficits means that private capital will be needed like never before,\u201d Fink and BlackRock President Rob Kapito said in a memo to employees. \u201cThis will be one of the fastest-growing areas of our industry over the next 10 years.\u201d\r\n\r\nThe deal, announced in a statement Friday along with a significant management shuffle, was the firm\u2019s largest acquisition since its 2009 purchase of Barclays Global Investors, putting the asset manager on a path to becoming the biggest provider of exchange-traded funds. The GIP agreement came as the firm posted better-than-expected fourth-quarter earnings with inflows pushing its total client assets back above $10 trillion for the first time in two years.\r\n\r\nBlackRock\u2019s shares fell slightly at 6:30 a.m. in early New York trading.\r\n\r\nFink, 71, built BlackRock largely on the back of a bet that investors big and small would take cheaper access to investing in indexes of public companies rather than pay stock-pickers. The deal for GIP marks a new conviction that the biggest institutions will pay higher fees to put money to work in illiquid funds that back major, complex projects.\r\n\r\nBlackRock is also seeking to position itself as a one-stop shop for a full range of investing options, including alternative assets that are in greater demand by institutional clients such as pensions, endowments and sovereign wealth funds. While alternatives currently account for roughly 3% of BlackRock\u2019s assets under management, they bring in about 10% of fees.\r\n\r\nThe firm\u2019s assets in illiquid alternatives jumped about 65% in the three years through September, and in 2023 it acquired Kreos Capital to fuel its growth in private debt.\r\n\r\nCombining GIP with the roughly $50 billion of infrastructure assets that BlackRock managed at the end of September will create a unit to rival the industry\u2019s largest players, including Macquarie Asset Management and Brookfield Asset Management. In recent years, BlackRock participated in multibillion-dollar investments in pipelines in the Middle East, a carbon-capture project in Texas and a fiber network venture with AT&T Inc.\r\n\r\nInfrastructure has been a growing corner of the alternatives market as investors see opportunities to profit from helping to fill what consultants at McKinsey project will be a $15 trillion spending gap on global infrastructure through the end of the decade. That demand held up even during recent dips in other private products, as fundraising in the area rose in 2022 while private equity and real estate\u2019s totals slumped.\r\n\r\nGIP has been among the biggest players in that world, taking notable stakes in some of the busiest airports, including London\u2019s Gatwick. While infrastructure bets can include more mundane projects such as toll roads and bridges, investing giants have also increasingly seen opportunities in energy-transition projects and data centers. They\u2019re drawn by the typically stable, recurring returns those assets can generate.\r\n\r\nOgunlesi, 70, launched the firm in 2006 with backing from General Electric Co. and Credit Suisse, and its portfolio companies have combined annual revenues of more than $80 billion, according to its website. Ogunlesi currently serves as Goldman Sachs Group Inc.\u2019s lead director.\r\n\r\nIn 2019, GIP raised a then-record $22 billion for a flagship fund, Global Infrastructure Partners IV, and recently has been raising a fifth fund.\r\n\r\nFive of GIP\u2019s founding partners will join BlackRock. About 30% of the shares will be deferred for about five years, and BlackRock said it will issue debt to cover the cash portion. Perella Weinberg Partners advised BlackRock, while Evercore Inc. was lead adviser for GIP."

"BlackRock buys Nigerian infrastructure firm GIP for $12.5 billion in major alternatives push"

Petrol price rises to GHS 15.22 per litre as diesel falls to GHS 14.65AMP

Cocoa whipsaws to close one of the wildest weeks market has seenAMP

Namibia bets on Africa’s green hydrogen with $267m export harbourAMP

Nigeria’s maritime logistics cruise as ports get a makeoverAMP

Top 5 African cities with the most unaffordable real estate in 2024AMP

NGX starts May on bullish note as investors gain N300 billionAMP

Aramco leads oil industry investment in AIAMP

Embracing green HR practices for environmental sustainabilityAMP

Stanbic employees donate to Nsawam Women’s PrisonAMP

Petrol price rises to GHS 15.22 per litre as diesel falls to GHS 14.65AMP

Cocoa whipsaws to close one of the wildest weeks market has seenAMP

Namibia bets on Africa’s green hydrogen with $267m export harbourAMP

Nigeria’s maritime logistics cruise as ports get a makeoverAMP

Top 5 African cities with the most unaffordable real estate in 2024AMP