In an attempt to solidify its foothold in the global real
estate business, N.Y. based
) entered into a definitive agreement with MGPA - an independent
private-equity property investment advisory firm - to purchase
the latter. However, the terms and value of the deal have not
The transaction is expected to be completed in the third quarter
of 2013, subject to customary regulatory approvals and closing
This acquisition will enable BlackRock to acquire MGPA's assets
under management worth approximately $12 billion. This will take
the total amount invested by BlackRock in the worldwide real
estate business to $25 billion.
MGPA, which houses offices across the globe, manages real-estate
funds for its clients and accounts for institutional investors.
Two-third of the company's assets is deployed in the Asia-Pacific
region and Europe. Moreover, MGPA made approximately 130
investments over the past several years in these regions.
On the other hand, BlackRock's current real estate investment
business worth about $13 billion is concentrated mainly in the
U.S. and the UK. However, with this acquisition, BlackRock will
be able to enhance its presence in real estate markets in the
Asia-Pacific region and Europe.
Previous Deals by BlackRock
In 2012, BlackRock acquired Swiss Re Private Equity Partners
(SRPEP) AG, the private equity operations arm of the fund
management group, Swiss Re Ltd. BlackRock and Swiss Re entered
into an agreement to divert the latter's investments in SRPEP to
BlackRock Alternative Investors (BAI). The acquisition merged
SRPEP into BlackRock Private Equity Partners (BRPEP).
Further in 2012, BlackRock purchased Canada-based Claymore
Investments. The deal supplemented $7.3 billion of assets under
management, mostly in equity and fixed income and resulted in the
addition of 38 exchange traded funds (
) to its iShares brand.
In 2010, the company acquired Helix Financial Group LLC, a
N.C.-based company. This acquisition expanded the commercial real
estate capabilities of BlackRock, including its Financial Markets
Advisory Group practice.
The acquisition of Barclays Global Investors (BGI), a wing of
) in 2009, remains a significant deal in BlackRock's history. The
company agreed to purchase BGI, furnishing it with $3.1 trillion
as assets, and its exchange-traded-fund business, iShares.
BlackRock's acquisition of MGPA is a strategic fit and is
expected to magnify the company's geographic footprint. Further,
it will auger well for the global diversification of the
BlackRock currently carries a Zacks Rank #2 (Buy). Other stocks
in the same sector worth considering include
AllianceBernstein Holding L.P
). Both these companies carry a Zacks Rank #1 (Strong Buy).
ALLIANCEBERNSTN (AB): Free Stock Analysis
BARCLAY PLC-ADR (BCS): Free Stock Analysis
BLACKROCK INC (BLK): Free Stock Analysis
INVESCO LTD (IVZ): Free Stock Analysis Report
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