MetLife reported $16 million in net income for SSRM in the second quarter in its most recent quarterly report. That figure is based on $91 million in gross revenue.
Another banker, who also wished to remain anonymous, said: "The deal gives BlackRock a much deeper equity bench." He noted that SSRM, which manages a total of about $20 billion in equity separate accounts and mutual funds, offers a strong small-cap value equity strategy, as well as large-cap core, growth and value equity funds. BlackRock manages about $13.5 billion in large-, mid- and small-cap equity assets.
An individual close to the situation said MetLife sold SSRM because the increased regulatory scrutiny of the mutual fund world "made SSRM more of a headache than it was worth."
The acquisition, which is expected to close in about four months, would position BlackRock as the 15th largest U.S.-based money manager. As of July 31, SSRM managed a total of $52 billion — of which about 52% was in various fixed-income strategies. BlackRock, which is known as one of the top bond managers in the United States, manages about $314 billion.
BlackRock's Mr. Fink said the purchase was not an "asset grab." He noted SSRM offers capabilities the bond giant does not have, including SSR Realty Advisors Inc., which manages about $6 billion for institutional clients, mainly in separate account and commingled real estate funds, and a structured products group, which handles about $2 billion in collateralized debt obligations.
Mr. Fink also does not expect there to be much overlap, even on the fixed-income side. "BlackRock is known as a fixed-income shop," he said. "But we don't have a monopoly on bond management. SSRM provides us with a little more depth in the bond area." Two units that are particular strong at SSRM are its market-based strategies group, headed by Brett Wander, and its long-duration bond unit, headed by Dan Strelow.