BlackRock, Inc. has entered into a definitive agreement to acquire Swiss Re Private Equity Partners AG (SRPEP), which is the European private equity and infrastructure fund of funds franchise of Swiss Re.
BlackRock and Swiss Re have also entered into a strategic alternative investment relationship agreement, centered on BlackRock Alternative Investors (“BAI”), which will reinforce Swiss Re’s current investments in SRPEP products and establishes other future Swiss Re commitments to the BAI platform.
Operating from Zurich, Hong Kong, New York and Bratislava, SRPEP had $7.5 billion in total commitments at May 31, 2012. This includes a commitment from Swiss Re which had invested alongside its clients.
SRPEP will be integrated with BlackRock’s existing private equity fund of funds group – BlackRock Private Equity Partners (“BRPEP”). BlackRock says the transaction will extend BRPEP’s investment capabilities into infrastructure investing, expand its European and Asian footprint, and establish the unit’s presence in Switzerland.
The unified platform will have approximately $15 billion in client commitments. The team will invest in primary funds, secondaries and direct co-investment opportunities through core fund of funds, direct co-investment programs and other offerings.
“In an environment where yields are low and volatility is high, clients around the world are embracing alternatives which offer higher return potential and the ability to mitigate risk,” said
Matthew Botein, managing director and head of BlackRock Alternative Investors, in a statement. “We are thrilled to be welcoming Swiss Re Private Equity Partners to BlackRock and believe its well respected capabilities enhance our ability to deliver innovative solutions to our global client base.
Russell Steenberg, managing director and head of BRPEP will continue to lead the combined unit. Christian Hinze, chief executive of SRPEP, will join BlackRock as deputy head of the combined business.
There are no changes expected to the investment strategy or style of either business’s existing offerings, each of which will continue to be managed by members of their existing portfolio management teams.
Following the satisfaction of customary closing conditions, the transaction is expected to be completed by the end of the third quarter of 2012. Terms of the all-cash transaction, which will be neutral-to-modestly accretive to BlackRock’s 2012 earnings, were not disclosed.