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BlackRock Plans to Sell a Group of PE Funds Worth $200M

BlackRock, Inc.BLK is planning to sell a portfolio of private equity funds with a valuation of around $200 million in the secondary market. The news first reported by Bloomberg stated that the New York based asset manager is offloading the funds as some assets are attracting high prices in the secondary market.

Citing people familiar with the matter, the report mentioned that the concerned group of funds is the one that BlackRock earlier invested in from 2000 to 2006. The portfolio of funds had original commitments of around $1 billion.

This move by the world's largest asset manager comes as part of its portfolio management review. Notably, earlier this year, the company through its unit - Private Equity Partners - had sold a number of similar portfolios.

Strong prices in the burgeoning secondary market has attracted sellers to cash out their investments, while buyers want to take advantage of a more predictable outcome from an old fund than a new fund. According to Evercore Partners Inc., an independent investment banking advisory firm, secondaries market sale increased 80% year over year to $47 billion in 2014, reaching its highest point since the 2008 financial crisis. Given that secondary market fund buyers held $55 billion in dry powder (capital meant for investing in private equity funds) at the close of 2014, strong volume of deals are predicted to continue into 2015 as well.

BlackRock currently carries a Zacks Rank #3 (Hold). Some better-ranked investment managers include Woori Bank Co., Ltd. WF , Eagle Point Credit Company Inc. ECC and Man Group plc MNGPY , each holding a Zacks Rank #2 (Buy).

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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