BlackRock has agreed to buy HPS Investment Partners in a $12bn deal, as the world’s largest money manager races to expand its share of the fast-growing and lucrative market for alternative assets. New York-based HPS is one of a handful of groups that dominate private credit, a market that has taken over swaths of corporate lending from traditional banks. BlackRock has agreed to pay $9.3bn in stock when the deal closes and a further 2.
Most of the money will go to HPS’s top partners, but up to $675mn of the proceeds will be used for a broader retention pool. HPS was founded in 2007 when its now chief executive Scott Kapnick decamped from Goldman Sachs to JPMorgan Chase and launched the business with colleagues Scot French and Michael Patterson. The trio and a handful of other HPS partners bought the firm out from JPMorgan in 2016 for less than $1bn, according to people with knowledge of the matter.