BlackRock's $3.2 Billion Preqin Deal Set to Revolutionize Private Markets Data

BlackRock, Inc. (NYSE: BLK) has announced its agreement to acquire Preqin, a leading independent provider of private markets data, for approximately $3.2 billion in cash. The deal, expected to close by the end of 2024, marks BlackRock's strategic expansion into the rapidly growing private markets data segment.

Bridging the Gap in Private Markets

The acquisition comes at a time when private markets are experiencing unprecedented growth. With alternative assets projected to reach nearly $40 trillion by the end of the decade, the need for standardized data, benchmarks, and analytics in this sector has never been more critical.

Preqin, with its 20-year history and global coverage of 190,000 funds, 60,000 fund managers, and 30,000 private markets investors, is poised to fill this gap. The company is expected to generate approximately $240 million in highly recurring revenue in 2024, having grown at a rate of about 20% annually over the past three years.

A Strategic Move for BlackRock's Aladdin Platform

BlackRock plans to integrate Preqin's extensive data and research tools with its Aladdin platform, which currently serves over 1,000 clients. This integration aims to create a unified platform that combines data, research, and investment processes across various aspects of private markets investing.

Rob Goldstein, BlackRock's Chief Operating Officer, emphasized the strategic importance of this acquisition: "BlackRock's vision has always been to bring together investments, technology, and data to offer solutions that meet our clients' needs across their whole portfolio. As clients increasingly evolve their focus from choosing products to constructing portfolios, this shift requires technology, data, and analytics that create a 'common language' for investing across both public and private markets."

Expanding Market Opportunities

The private markets data sector represents a significant growth opportunity, with an estimated total addressable market of $8 billion, projected to reach $18 billion by 2030. This acquisition positions BlackRock to capitalize on this growth while enhancing its capabilities in private markets investing.

Sudhir Nair, Global Head of Aladdin, highlighted the potential impact: "Together with Preqin, we can make private markets investing easier and more accessible while building a better-connected platform for investors and fund managers. This presents a substantial opportunity for Aladdin to bridge the transparency gap between public and private markets through data and analytics."

Leadership Transitions

As part of the deal, Preqin founder Mark O'Hare will join BlackRock as a Vice Chair after the transaction closes. O'Hare expressed his enthusiasm for the merger: "BlackRock is known for excellence in both investment management and financial technology, and together we can accelerate our efforts to deliver better private markets data and analytics to all of our clients at scale. I look forward to joining BlackRock and continuing to play a role in the continued growth and success of Preqin and our customers."

Christoph Knaack, CEO of Preqin, also shared his optimism: "Private markets continue to evolve and so is Preqin. I am incredibly excited about the opportunities this next phase of growth, together with BlackRock, promises our customers and our employees."

The transaction is subject to regulatory approvals and other customary closing conditions. As the private markets continue to evolve, this landmark acquisition signals a new era in data-driven investment strategies and portfolio management across the alternative asset landscape.