BlackRock Expands Private Credit Portfolio With $12-B HPS Purchase

BlackRock announced it will acquire private credit firm HPS Investment Partners for approximately $12 billion in an all-stock deal, signaling the asset manager’s strategic push into the booming private credit market, reported by Arasu Kannagi Basil and Davide Barbuscia for Reuters.

The private credit market is projected to grow from $1.5 trillion at the end of 2023 to $2.6 trillion by 2029. I Photo: Jim.henderson Wikimedia Commons

Private credit, which involves non-bank institutions lending to companies, has seen significant growth in recent years as regulatory changes increased the cost of riskier loans for traditional lenders.

The market is projected to grow from $1.5 trillion at the end of 2023 to $2.6 trillion by 2029, according to Preqin data.

“Together, we will deliver income solutions for our clients that blend both the best of the public markets and the best of the private markets in an organized, unified fashion,” BlackRock CEO Larry Fink said.

He has identified private credit as a “primary growth driver” within BlackRock’s alternatives strategy.

HPS was established in 2007 as a division of Highbridge Capital Management, a JPMorgan asset management unit.

After being acquired by its top executives in 2016, the New York-based firm has grown into a major player in the private credit space, with assets under management rising from $34 billion in 2016 to $148 billion as of September 2024.