BlackRock will acquire infrastructure firm Global Infrastructure Partners in a $12.5 billion deal, creating a platform with more than $150 billion in assets.
The $10 trillion manager will pay a total $3 billion in cash and about 12 million shares of BlackRock common stock, worth approximately $9.5 billion based on the closing price on Jan. 11, a joint news release said.
GIP, which has offices in New York, London, Sydney and other cities, was founded in 2006 and manages more than $100 billion in infrastructure equity and debt assets. The firm focuses on energy, transport, water and waste, and the digital sectors.
BlackRock has more than $50 billion in infrastructure AUM across equity, debt and solutions, managing assets since 2011.
Bayo Ogunlesi, founding partner, chair and CEO at GIP, will lead the combined platform along with four of the firm's other founding partners. BlackRock also agreed to appoint Ogunlesi to its board at its next scheduled board meeting following the deal close, subject to procedures, the release said.
"Infrastructure is one of the most exciting long-term investment opportunities, as a number of structural shifts re-shape the global economy," said Laurence D. Fink, BlackRock CEO, in the release. "We believe the expansion of both physical and digital infrastructure will continue to accelerate, as governments prioritize self-sufficiency and security through increased domestic industrial capacity, energy independence, and onshoring or near-shoring of critical sectors. Policymakers are only just beginning to implement once-in-a-generation financial incentives for new infrastructure technologies and projects."
The deal is set to complete in the third quarter.