BlackRock had acquired investment management software company eFront for $1.3 billion in cash
The company said the deal would be funded in cash and debt, private-equity firm Bridgepoint owns eFront.
“eFront expands Aladdin’s alternatives capabilities and further distinguishes it as the comprehensive investment operating platform,” a BlackRock Chief Operating Officer Rob Goldstein said.
BlackRock buys 3.1 million of its shares for $412.84 a share under its existing buyback program. Technology and illiquid alternatives are the strength of BlackRock’s growth, and the transaction provides an opportunity to accelerate positioning in both” BlackRock chairman, and CEO Larry Fink said in a statement.
HSBC signed an agreement to offer the Aladdin investment management software to its customers. BlackRock’s Solutions division increased its revenues by 19.5% in 2018, but it remains smaller than the company’s asset management business.
In another insight, according to a study from Morgan Stanley and Oliver Wyman., alternate investments will make up 40% of revenue in the global asset management industry by 2023. Therefore, this is a step in the right direction.