BlackRock Inc. is set to acquire Global Infrastructure Partners, owned by Nigerian investment banker Adebayo Ogunlesi, for over $12.5 billion in cash and stock, Financial Times reported on Friday.
According to the international business newspaper, BlackRock’s acquisition of GIP, with assets worth $106 billion under management, would make it the world’s second-largest infrastructure manager after Macquarie and bolster the leadership of its alternative business.
The deal will also substantially boost the $10 trillion money manager’s footprint in alternative assets and shake up the landscape for private market investing.
With the purchase, BlackRock will take over GIP’s prime assets, such as Sydney and London Gatwick airports, the Port of Melbourne and the Suez water group, extensive green energy holdings and a stake in a big shale oil pipeline.
BlackRock also agreed to pay $3 billion in cash and 12mn of its shares to GIP’s chair, Mr Ogunlesi, and five other founders, while 7mn of the shares will be handed over at closing, and the remaining 5mn will be due in five years.
Founder of BlackRock, Larry Fink, and its president, Rob Kapito, announced the purchase in a memo to its employees, explaining that “The global need for infrastructure combined with high deficits constraining government spending creates an unprecedented opportunity for private capital to invest in infrastructure.”
In a statement about the acquisition, Mr Ogunlesi, expected to resign as the lead director of Goldman Sachs and join BlackRock’s global executive committee and board, said, “We are convinced that together we can create the world’s premier infrastructure investment firm.”
Mr Ogunlesi had worked with Fink at Credit Suisse in the 1980s and later rose to head the investment banking at the defunct Swiss group before he established GIP in 2006.
