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BlackRock’s Aladdin Adds Alts Power
The world’s largest asset manager has agreed to buy alternative investment software provider eFront to bolster its widely-used investment operating platform.
Aladdin is looking to stay one jump ahead of its competitors.
BlackRock announced Friday plans to add alternative and multi-asset capabilities to the ubiquitous investment operating platform through an acquisition of eFront, a provider of alternative investment management software and services.The asset management firm said it's buying eFront from private equity firm Bridgepoint and eFront employees for $1.3 billion.
The combination of eFront and Aladdin will “set a new standard in investment and risk management technology,” according to BlackRock. Rob Goldstein, BlackRock’s chief operating officer, said in the statement that the eFront acquisition “vastly expands Aladdin’s alternatives capabilities.”
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More than $18 trillion is managed on the Aladdin platform, which BlackRock said is currently being used by more than 225 institutions globally. The addition of eFront – which serves more than 700 clients in 48 countries – will help BlackRock target the trillions of dollars of assets currently invested in alternative strategies like private equity.
“There are $9 trillion in alternative assets under management in the industry today and clients are incorporating them into their investment strategies at a record pace,” Goldstein said in the statement. “This has created an unprecedented need for risk and investment management capabilities spanning both public and private asset classes.”
The eFront platform will be integrated with Aladdin while also being offered as a standalone product, according to Goldstein’s statement.
Beyond Aladdin, Goldstein said the acquisition would also enhance BlackRock’s alternatives investment platform. The firm’s institutional alternatives business had $93.8 billion under management as of the end of 2018.
“Technology and illiquid alternatives are two pillars of BlackRock’s growth, and this transaction provides a unique opportunity to accelerate our positioning in both,” BlackRock CEO and chairman Larry Fink said in a statement. “eFront immediately deepens our presence and technology capabilities in France, Europe, and across the globe.”