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BlackRock (BLK) Closes Buyout of Aperio From Golden Gate

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Shares of BlackRock (BLK - Free Report) gained 2.3%, following the completion of the deal to acquire investment management services provider, Aperio Group LLC, from Golden Gate Capital and Aperio employees. BlackRock entered the $1.05-billion cash deal in November 2020. The transaction is expected to help BlackRock in expanding its presence in the separately managed accounts (“SMAs”) market.

Martin Small, the head of BlackRock’s U.S. Wealth Advisory business, stated, “Completion of the Aperio transaction accelerates BlackRock’s ambition to lead the industry from ‘one size fits all’ to ‘one size fits one’ – a portfolio that is hyper-personalized to reflect an investor’s unique risk, tax, and personal values preferences. We are excited to welcome the talented Aperio team to BlackRock.”

At the time of the announcement of the deal, it was anticipated that the transaction will be minimally dilutive to earnings per share (“EPS”) although not dilutive on a cash basis.

Notably, Aperio is a pioneer in customizing tax-optimized index equity SMAs that reflect the uniqueness of each of its clients’ risk, tax and personal value preferences. Its high-touch consultative client services focus on the ultra-high net worth households, and institutions that are served by private banks and independent registered investment advisors (“RIAs”).

BlackRock will operate Aperio as a separately branded, vertically integrated team within its U.S. Wealth Advisory business.

Aperio’s co-heads, Liz Michaels and Ran Leshem, said, “Working with BlackRock, we will be able to enhance Aperio’s bespoke problem-solving capabilities for our current clients and expand our reach across wealth managers serving ultra-high net worth families and institutions. We look forward to Aperio’s next chapter as part of BlackRock.”

Our Take

Supported by a solid liquidity position, BlackRock has continuously been engaging in inorganic growth efforts for the past several years. Its broad product diversification, revenue mix and steadily improving assets under management (“AUM”) balance are expected to keep aiding growth in the quarters ahead. The company’s constant efforts to strengthen the iShares and exchange traded fund (“ETF”) operations along with its increased focus on active equity business remain impressive.

Shares of the company have gained 27.7% over the past six months, outperforming 23% growth recorded by the industry.






Currently, BlackRock carries a Zacks Rank #3 (Hold).

A few better-ranked stocks from the same space are mentioned below.

AllianceBernstein Holding L.P.’s (AB - Free Report) earnings estimates for 2021 have moved up 12.1% over the past 60 days. The company’s shares have gained 33.6% over the past six months. At present, it carries a Zacks Rank #2 (Buy).

The Blackstone Group Inc.’s (BX - Free Report) earnings estimates for 2021 have moved 10.5% upward over the past 60 days. The stock has appreciated 36.1% over the past six months. The company currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Ameriprise Financial, Inc.’s (AMP - Free Report) earnings estimates for 2021 have increased 5.6% over the past 60 days. The company’s shares have gained 33.7% over the past six months. At present, it flaunts a Zacks Rank #1.

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