BlackRock, the world’s largest asset manager, has agreed to buy the private equity and infrastructure fund of funds arm of insurance giant Swiss Re in a bid to bolster its presence in the infrastructure space and expand its European and Asian footprint.
Swiss Re Private Equity Partners (SRPEP) will be integrated with BlackRock Private Equity Partners (BRPEP), the firm’s existing fund of funds group.
Financial terms of the deal were not disclosed.
BlackRock and Swiss Re have also entered into a strategic alternative investment relationship agreement, centered on BlackRock Alternative Investors (BAI), which reinforces 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 $7.5bn in total commitments at 31 May 2012, including a significant commitment from Swiss Re as it invested alongside its clients.
The transaction extends BRPEP’s investment capabilities into infrastructure investing, expands its European and Asian footprint, and establishes the unit’s presence in Switzerland where BlackRock has a presence in Zurich and Geneva.
The unified platform will manage around $15bn in client commitments and will invest in primary funds, secondaries and direct co-investment opportunities through core fund of funds, direct co-investment programmes and other offerings.
Russell Steenberg, managing director and head of BRPEP will continue to lead the combined unit. Christian Hinze, CEO of SRPEP, will join BlackRock as deputy head of the combined business.
“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,” BAI manging director Matthew Botein said.
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