UK data firm Preqin will enhance BlackRock Aladdin tech business by combining data, research, and investment processes for fund managers.
The world’s largest asset manager, Black Rock, is to acquire a UK-based data and insights company, Preqin, focusing on the alternative assets market, which includes anything from private equity to infrastructure.
The acquisition is supposed to complement Aladdin – BlackRock’s portfolio management software, providing investment professionals with overview and management tools for their daily investments. In particular, Preqin’s capabilities can enhance insights into the private markets data segment.
Alternative assets are becoming increasingly important in high-net-worth investors’ portfolios. They involve higher risks than traditional investments and are suitable primarily for sophisticated investors. For a long time, alternative assets remained a niche segment, with under 6% of global assets under management (AUM). At the same time, alternative assets are growing more popular as investors seek to diversify their portfolios. Today, they constitute 15% of global AUM, with prospects to reach 24% in the next 1-2 years.
Private markets are the fastest-growing part of asset management. Therefore, the strategic expansion of Aladdin tech business into the private markets data segment is estimated to unlock an additional $8 billion of the total addressable market. In addition, Preqin expands BlackRock’s client base with 4,000+ relationships across GPs, LPs and service providers and an expected ~$240 million of highly recurring 2024 revenue, according to the press release.
Preqin has global coverage of 190,000 funds, 60,000 fund managers, and 30,000 private markets investors, reaching more than 200,000 users, including asset managers, insurers, pensions, wealth managers, banks, and other service providers. It will continue to be offered as a standalone data solution while also being combined with eFront, Aladdin’s private markets 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.”
Sudhir Nair, Global Head of Aladdin
BlackRock is continuously seeking to capitalize on the fast-growing alternative asset market. In January, the asset manager acquired Global Infrastructure Partners (GIP), which at the time managed assets with a total value of $100 billion, for $12,5 billion, marking BlackRock’s largest deal in over a decade.
