BlackRock is spending $12 billion to buy Global Infrastructure Partners

BlackRock Inc (NYSE: BLK) is in focus this morning after announcing plans of buying Global Infrastructure Partners for about $12 billion.

Details of BlackRock – GIP agreement

The asset manager expects this cash and stock deal to help expand its footprint in infrastructure that Larry Fink – its chief executive sees as “one of the most exciting long-term investment opportunities”.

Blackrock coming together with Global Infrastructure Partners creates a “multi-asset class infrastructure investing platform” with more than $150 billion worth of assets under management.

That transaction that is yet to secure regulatory approval is expected to complete in the third quarter of 2024.

The news arrives only days after it received approval from the Securities & Exchange Commission of the United States for a Spot Bitcoin ETF (find out more).

BlackRock to take on additional debt

BlackRock Inc expects this acquisition to be modestly accretive to its adjusted per-share earnings and operating margin a year after close. According to Larry Fink:

The asset manager also said in a press release today that it will take on $3.0 billion in additional debt to fund the cash part of its agreement with Global Infrastructure Partners.

On Friday, BlackRock also reported assets under management (AUM) and per-share earnings (adjusted) for its fourth quarter – both of which topped Street estimates. Wall Street currently has a consensus “overweight” rating on $BLK that’s trading about flat in premarket on Friday.