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BlackRock Mulls Over Buying Minority Stake in Millennium Management

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BlackRock Inc. (BLK - Free Report) is negotiating with Millennium Management to acquire a minority stake in the hedge fund, according to people familiar with the matter. This was first reported by The Financial Times.

Millennium, one of the world’s leading hedge funds, was founded by Israel Englander in 1989 and currently manages roughly $70 billion in assets.
 
The discussions between BLK and Millennium are in the initial phase and may not lead to a finalization of the deal.

Reasons Behind BLK’s Pursuit

This move aligns with BlackRock’s pursuit of becoming a one-stop shop for its investors through various offerings, including stocks, bonds, private strategies and financial consulting for strategic and governmental clients, boosting its revenues and profits.
 
BlackRock, the world’s largest asset manager, has been trying to expand into profitable alternatives assets investment as these generate more fees compared with traditional ones. Hence, the company has been expanding aggressively into this asset class. Last month, it acquired Global Infrastructure Partners, creating an industry leader in infrastructure.
 
Moreover, this September, BLK collaborated with Partners Group to introduce a multi-private markets model solution, boosting retail investors’ accessibility to alternative investments. Further, this June, the company agreed to acquire Preqin, a premier provider of private markets data, to enhance its private markets capabilities.

Recently, it was reported that BLK is in talks to acquire HPS Investment Partners. HPS, which manages more than $100 billion and is one of the largest independent managers in the private credit market.

BlackRock’s Zacks Rank & Price Performance

Year to date, shares of BlackRock have gained 27.6% compared with the industry’s 39.4% growth. 

Zacks Investment Research
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Currently, BLK sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Acquisitions Pursued by Other Finance Firms

Earlier this month, The Bank of New York Mellon Corporation (BK - Free Report) acquired Archer Holdco, LLC, a leading technology-enabled service provider of managed account solutions to the asset and wealth management industry. The financial terms of the deal, announced on Sept. 5, were kept under wraps.

Archer’s clients will gain access to fully integrated solutions covering the entire managed account lifecycle, benefiting from the broader capabilities of the BNY enterprise. This deal uniquely positions BK as the leading service provider, aiding asset managers across all fund types for institutional and retail investors.

Similarly, Barclays PLC (BCS - Free Report) completed the acquisition of the retail banking business of Tesco Personal Finance plc. The deal was announced in February.

The deal is anticipated to result in the recognition of an estimated pre-tax profit of £0.3 billion in the fourth quarter of 2024, generating a 50-basis point accretion for 2024 group return on tangible equity for BCS.


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