v3.26.1
Acquisitions
 3 Months Ended
Mar. 31, 2026
Business Combination [Abstract]  
Acquisitions

3. Acquisitions

HPS Investment Partners

On July 1, 2025, BlackRock completed the acquisition of 100% of the business and assets of HPS (the "HPS Transaction"), a leading global credit investment manager, with substantially all consideration paid in Class B-2 common units ("Subco Units") of BlackRock Saturn Subco, LLC ("Subco"), a consolidated subsidiary of the Company. Concurrent with the acquisition, BlackRock Finance, Inc., Global Infrastructure Management, LLC ("GIP"), HPS, and their respective subsidiaries became wholly owned subsidiaries of Subco. The HPS Transaction, which added $165 billion of client AUM and $118 billion of fee-paying AUM, positioned the Company to provide an integrated private credit platform with both public and private income solutions for clients across their whole portfolios.

At close, approximately 8.5 million Subco Units were delivered to former equityholders of HPS and valued at $8.5 billion, based on the price of BlackRock's common stock on June 30, 2025 of approximately $1,049 and discounted for a one-year lack of marketability before exchange rights begin. Such Subco Units are exchangeable on a one-for-one basis into BlackRock common stock (accordingly, the value of each unit delivered was based on the price of a share of BlackRock’s common stock and the specific terms of the Subco Units). Subco Units are also eligible to receive distributions at an amount equal to the dividend amount paid on each share of BlackRock common stock.

In addition, as part of the purchase consideration, a contingent consideration payment, all in Subco Units, may be due subject to the achievement of certain post-closing conditions and financial performance milestones. The contingent consideration, if any, ranges from approximately 2.8 million to 4.4 million Subco Units and is expected to be payable approximately five years following the closing of the HPS Transaction. The fair value of the contingent consideration payment, which was determined by using the income approach with the assistance of a third-party valuation specialist, was $3.4 billion at close, and was recorded within contingent consideration liabilities in the condensed consolidated statements of financial condition. Certain significant inputs were used to determine the fair value, including assumptions on discount rates as well as estimates of the timing and amounts of fundraising and fee related earnings forecasts, cost of equity, and stock price performance (Level 3 inputs). The contingent consideration was classified as a liability as the value of the consideration to be delivered in Subco Units is predominantly based on achieving certain performance targets or certain settlement provisions of the Subco Units. See Note 8, Fair Value Disclosures and Note 15, Commitments and Contingencies for additional information on the contingent consideration related to HPS.

In addition, at the time of close, the Company granted incentive retention awards to certain employees of approximately 680,000 RSUs that vest in increasing yearly increments over five years valued at $675 million and approximately 270,000 RSUs valued at $260 million that cliff vested 100% at December 31, 2025. See Note 17, Stock-Based Compensation, for additional information on the incentive retention awards issued in connection with the HPS Transaction.

In general, if (i) the maximum amount of contingent consideration is achieved, (ii) all Subco Units are exchanged for shares of the Company’s common stock (including those issued on the closing date), and (iii) all RSUs vest and are settled in the form of shares of the Company’s common stock, the Company does not expect to issue more than approximately 13.8 million shares of common stock in the aggregate.

The HPS Transaction was accounted for as a business combination under the acquisition method of accounting. Accordingly, the purchase price of the HPS Transaction was allocated to the assets acquired and liabilities assumed based upon their estimated fair values at the date of the transaction. The goodwill recognized in connection with the acquisition is non-deductible for tax purposes and includes future benefits for BlackRock as a result of scale and anticipated synergies from combining the Company's and HPS's capabilities by creating one integrated private financing solutions platform.

The following table summarizes the consideration paid for HPS and the fair values of the assets acquired and liabilities assumed recognized at the acquisition date:

(in millions)

 

Fair Value Estimate

 

Investments

 

$

1,972

 

Finite-lived intangible assets:

 

 

 

Management contracts(1)

 

 

2,660

 

Investor relationships(1)

 

 

965

 

Indefinite-lived intangible assets - management contracts(2)

 

 

3,000

 

Goodwill

 

 

6,841

 

Operating lease right-of-use ("ROU") assets

 

 

178

 

Other assets

 

 

644

 

Accrued compensation and benefits

 

 

(262

)

Accounts payable and accrued liabilities

 

 

(162

)

Operating lease liabilities

 

 

(150

)

Deferred income tax liabilities

 

 

(1,585

)

Other liabilities assumed(3)

 

 

(1,880

)

Total consideration, net of cash acquired

 

$

12,221

 

 

 

 

 

Summary of consideration, net of cash acquired:

 

 

 

Closing consideration at fair value - Subco Units(4)

 

$

8,452

 

Cash acquired

 

 

(244

)

Deferred consideration at fair value - Subco Units(4)

 

 

3,400

 

Debt repayment

 

 

613

 

Total consideration, net of cash acquired

 

$

12,221

 

 

(1)
The fair value for finite-lived management contracts and investor relationships was determined using the excess earnings method (Level 3 inputs), have weighted-average estimated useful lives of approximately 8 years and 12 years, respectively, and are amortized based on the straight-line method.
(2)
The fair value for indefinite-lived management contracts was determined using the excess earnings method (Level 3 inputs).
(3)
Other liabilities assumed primarily included deferred carried interest.
(4)
The fair value for the closing consideration was determined based on approximately 8.5 million of Subco Units, which were delivered to former equityholders of HPS. The fair value of the deferred consideration was determined based on approximately 2.8 million to 4.4 million of Subco Units, and is subject to the achievement of certain post-closing conditions and financial performance milestones.

At this time, the Company does not expect material changes to the value of the assets acquired or liabilities assumed in conjunction with the HPS Transaction.

Preqin Holding Limited

On March 3, 2025, BlackRock completed the acquisition of 100% of the shares of Preqin Holding Limited (the "Preqin Transaction" or "Preqin"), a leading provider of private markets data, for £2.5 billion (or approximately $3.2 billion) in cash.

The purchase price for the Preqin Transaction was allocated to the assets acquired and liabilities assumed based upon their estimated fair values at the date of the transaction. The goodwill recognized in connection with the acquisition is non-deductible for tax purposes and includes anticipated synergies from incorporating Preqin data, insight and analytics into BlackRock’s investment technology, presenting an opportunity for Aladdin to bridge a transparency gap between public and private markets.

The following table summarizes the consideration paid for Preqin and the fair values of the assets acquired and liabilities assumed recognized at the acquisition date:

(in millions)

 

Fair Value Estimate

 

Finite-lived intangible assets:

 

 

 

Customer relationships(1)

 

$

1,050

 

Technology-related(2)

 

 

125

 

Trade name

 

 

7

 

Goodwill

 

 

2,377

 

Other assets

 

 

59

 

Deferred revenue

 

 

(104

)

Deferred income tax liabilities

 

 

(298

)

Other liabilities assumed

 

 

(93

)

Total consideration, net of cash acquired

 

$

3,123

 

 

 

 

 

Summary of consideration, net of cash acquired:

 

 

 

Cash paid

 

$

3,219

 

Cash acquired

 

 

(96

)

Total consideration, net of cash acquired

 

$

3,123

 

 

(1)
The fair value was determined using an income approach (Level 3 inputs), has a weighted-average estimated useful life of approximately 8 years and is amortized based on its expected pattern of economic benefit.
(2)
The fair value was determined using a replacement cost approach (Level 3 inputs), has a weighted-average estimated useful life of approximately 5 years and is amortized based on the straight-line method.

Unaudited Pro Forma Information

The following unaudited pro forma information presents combined results of operations of the Company as if the HPS Transaction had occurred on January 1, 2024. The unaudited pro forma financial information is not indicative of the actual results of operations that would have been achieved nor is it indicative of future results of operations of the combined Company. The pro forma combined provision for income taxes may not represent the amount that would have resulted had BlackRock and HPS filed consolidated tax returns during the years presented.

 

 

Three Months Ended

 

 

(Unaudited) (in millions)

 

March 31, 2025

 

 

Total revenue

 

$

5,685

 

 

Net income attributable to BlackRock, Inc.

 

$

1,409

 

 

Pro forma adjustments related to HPS include compensation expense for retention-related deferred compensation awards, amortization of finite-lived intangible assets, acquisition-related transaction costs, related tax effects, and the allocation of net income to NCI - Subco. See Note 3, Acquisitions, in the 2025 Form 10-K for more information regarding the Company’s pro forma adjustments.

Pro forma financial information for Preqin has not been presented, as the effects were not material to net income attributable to BlackRock, Inc.