(Bloomberg) — BlackRock Inc. Chief Executive Larry Fink said the acquisition of data provider Preqin will allow the firm, best known for its index funds, to apply the format to fast-growing assets .
“We believe we can index the private markets,” Fink said on a call with investors and analysts on Monday after the New York-based money manager announced the 2.55 billion pound ($3.2 billion) deal. “Just as indexing has become the language of public markets, we envision that we can bring iShares' indexing principles to private markets as well.”
The deal to buy the London-based private equity database provider accelerates BlackRock's push to become a major player in alternative assets and follows the firm's announcement that it would buy Global Infrastructure Partners for $12.5 billion.
Read more: BlackRock Buys Preq for $3.2 Billion in Private Data Push
Fink said indexes and data will eventually drive “the democratization of all alternatives,” and Fink and senior executives on Monday said the Preqin deal is about the ability of data and analytics to expand access to private assets in years to come. future.
According to BlackRock's statement, private markets are the fastest-growing segment of asset management, with alternative assets overall expected to reach nearly $40 trillion by the end of the decade. This is driving growing demand from investors for relevant data, with the total addressable market expected to reach $18 billion by 2030, up from around $8 billion today.
Fink said on Monday's call that increased data, standards and risk analysis software have transformed public markets, made them more accessible to investors and increased transparency in performance and return drivers.
“They have created stable, high-growth income groups that are adjacent to asset management and have generated great value for clients and shareholders,” he said. “Our goal is to do all of this in the much less mature data, analytics and index business for all private markets.
Preqini covers 190,000 funds, 60,000 fund managers and 30,000 private markets investors, according to a statement on Sunday. It is used by money managers, insurers, pension and wealth managers, among others, and has grown approximately 20% annually in the past three years.
The transaction is expected to close before the end of the year, subject to regulatory and other necessary approvals.