Larry Fink’s BlackRock is turning to infrastructure investing with its biggest takeover since 2009.Credit…Winnie Au for The New York Times
Seeing opportunity in bridges and tunnels
BlackRock is already Wall Street’s dominant player in stocks and bonds with $10 trillion in assets. Now the company plans to go big on the business of investing in airports, bridges, oil pipelines and more.
Alongside announcing its quarterly earnings, the firm said on Friday that it would acquire Global Infrastructure Partners for about $12.5 billion in cash and stock. The deal is BlackRock’s biggest takeover since 2009, when it bought Barclays Global Investors for $13.5 billion and became the world’s biggest provider of index funds.
It’s a major bet by BlackRock on infrastructure, in which financial firms invest in, or take over and run, assets like tunnels, highways, and oil and gas networks. The strategy has grown in popularity in recent decades in part because of steady long-term returns. Cash-strapped governments have also sought private money to help finance fiber broadband, data centers, green energy projects (which fit into BlackRock’s push to invest in climate-related assets), upgrades to airports and roads and more.
“Policymakers are only just beginning to implement once-in-a-generation financial incentives for new infrastructure technologies and projects,” Larry Fink, BlackRock’s chairman and C.E.O., said in a statement.
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