Investment giant BlackRock is to acquire Global Infrastructure Partners (GIP), the world’s largest independent infrastructure manager.
GIP owns major stakes in CyrusOne and Vantage Towers.
Announced this week, the companies have entered into an agreement for BlackRock to acquire GIP for a total of $3 billion of cash and approximately 12 million shares of BlackRock common stock.
The GIP management team, led by Bayo Ogunlesi and four of its founding partners, will lead the combined infrastructure platform.
“Infrastructure is one of the most exciting long-term investment opportunities, as a number of structural shifts re-shape the global economy. We believe the expansion of both physical and digital infrastructure will continue to accelerate, as governments prioritize self-sufficiency and security through increased domestic industrial capacity, energy independence, and onshoring or near-shoring of critical sectors. Policymakers are only just beginning to implement once-in-a-generation financial incentives for new infrastructure technologies and projects,” said Laurence D. Fink, BlackRock chairman and CEO.
BlackRock’s over $50 billion of infrastructure client assets under management comprises of infrastructure equity, debt and solutions, and has grown both organically and inorganically since inception in 2011. Investment areas include diversified infrastructure, infra debt, infra solutions, climate infrastructure and decarbonization partners.
BlackRock intends to fund the cash consideration through $3 billion of additional debt. The transaction is expected to close in Q3 2024 subject to regulatory approval and other closing conditions.
Fink added: “I’m delighted for the opportunity to welcome Bayo and the GIP team to BlackRock, and happy to announce our plans to have Bayo join our board of directors post-closing. We founded BlackRock 35 years ago based on a unique understanding of investment risk and the factors and forces driving investment returns. GIP’s deep understanding of the factors and forces driving operational efficiency for long-term value creation have made them a global leader in infrastructure investing. Bringing these two firms together will create the infrastructure platform to deliver best-in-class investment opportunities for clients globally, and we couldn’t be more excited about the opportunities ahead of us.”
Founded in 2006, GIP manages over $100 billion in client assets across infrastructure equity and debt, with a focus on energy, transport, water and waste, and digital sectors. Its digital investments include data center firm CyrusOne and Vodafone tower company Vantage Towers (both in partnership with KKR). The firm has also previously provided loans to data center firm Vantage (unaffiliated with the tower company).
“I’m excited about the power of this combination and the prospect of working with Larry and his talented team. We share with BlackRock a culture of collaboration, client focus, investment partnership, and commitment to excellence,” said GIP CEO Ogunlesi. “This platform is set to be the preeminent, one-stop infrastructure solutions provider for global corporates and the public sector, mobilizing long-term private capital through long-standing firm relationships. We are convinced that together we can create the world’s premier infrastructure investment firm.”
GIP’s other investments include Gatwick, Edinburgh, and Sydney Airports, Suez (water and waste), Pacific National and Italo (rail), Peel Ports and Port of Melbourne, and several renewables platforms, including Clearway, Vena, Atlas, and Eolian.
Perella Weinberg Partners served as lead financial advisor to BlackRock, with Skadden, Arps, Slate, Meagher & Flom and Fried, Frank, Harris, Shriver & Jacobson LLP acting as legal counsel. Evercore served as lead financial advisor and Kirkland & Ellis LLP and Debevoise & Plimpton LLP acted as legal counsel to GIP.
