BlackRock Acquires Private Markets Data Provider Preqin for $3.2B

BlackRock has agreed to acquire Preqin, a London-based provider of private markets data for £2.55 billion ($3.2 billion) in cash, as the world’s largest investment manager seeks to bolster its alternatives investing platform with the integration of data and technology solutions.

The transaction will boost BlackRock’s capabilities in private markets, the fastest growing segment of asset management with alternative assets expected to reach nearly $40 trillion by the end of the decade, and enables the fund manager to tap growing demand for private markets data and analytics, which has a total addressable market that is expected to reach $18 billion by 2030 from $8 billion today, according to the New York-based investment giant.

“BlackRock’s vision has always been to bring together investments, technology, and data to offer solutions that meet our clients’ needs across their whole portfolio,” BlackRock chief operating officer Rob Goldstein said in a release earlier this week. “As clients increasingly evolve their focus from choosing products to constructing portfolios, this shift requires technology, data, and analytics that create a ‘common language’ for investing across both public and private markets. We see data powering the industry across technology, capital formation, investing, and risk management.”

The transaction, which is subject to regulatory approvals and expected to close before year-end, will see BlackRock acquire Preqin from Valhalla Ventures, the holding company of founder Mark O’Hare which owns a roughly 80 percent stake, as well as Preqin’s management and employees, who hold the remaining interest. O’Hare will join BlackRock as a vice chair after the close of the transaction.

60,000 Fund Managers

BlackRock expects the “highly complementary” transaction to grow its client base by over 4,000 relationships across general partners, limited partners and service providers, and add around $240 million of recurring revenue in 2024.

Founded in 2003, Preqin has since expanded its global coverage to include 190,000 funds, 60,000 fund managers, 30,000 private markets investors and over 200,000 users, including asset managers, insurers, pensions, wealth managers, banks, and other service providers. Preqin’s recurring revenue grew by 20 percent per annum in the last three years, according to the statement.

BlackRock will integrate Preqin with eFront, the private markets solution of its portfolio management software platform Aladdin, with the combination set to bring together data, research, and investment process for fund managers and investors across fundraising, deal sourcing, portfolio management, accounting, and performance. Preqin will also continue to be offered as a standalone solution.

“Together with Preqin, we can make private markets investing easier and more accessible while building a better-connected platform for investors and fund managers. This presents a substantial opportunity for Aladdin to bridge the transparency gap between public and private markets through data and analytics,” said Sudhir Nair, BlackRock’s global head of Aladdin, which has over 1,000 clients.

The investment manager said the unified platform will address the growing need for standardised data, benchmarks, and analytics that enable investors to incorporate private asset classes into portfolios and provide fund managers with better data and tools to deliver outcomes for clients.

“BlackRock is known for excellence in both investment management and financial technology, and together we can accelerate our efforts to deliver better private markets data and analytics to all of our clients at scale,” said O’Hare.

Barclays served as lead financial advisor to BlackRock, with Skadden, Arps, Slate, Meagher & Flom acting as legal counsel. Goldman Sachs International served as the sole financial advisor, and Macfarlanes acted as legal counsel to Preqin.

Data is the New Gold

BlackRock’s acquisition is the latest in a series of deals involving financial data providers in recent years, with the investment community increasingly reliant on data, research, analytics and support tools to manage investments and assess risk and performance.

In May, S&P Global, the NYSE-listed parent company of ratings agency S&P Global Ratings, completed the acquisition of Visible Alpha, a provider of consensus forecast estimates, key performance indicators, and analytics from sell-side analyst models, with the platform having since been integrated under S&P’s Global Market Intelligence research and analytics unit.

In 2021, MSCI acquired real estate data and analytics firm Real Capital Analytics for $950 million, giving the provider of securities indexes ownership of a database cataloging global real estate investment transactions as well as institutional real estate fund and asset information.

That same year, London Stock Exchange Group completed its acquisition of data and analytics giant Refinitiv for $27 billion from Thomson Reuters and a Blackstone-led consortium of investors, while US private equity giant Carlyle Group led a $475 million series E funding round for US-based digital and tech sector data provider YipitData.