BlackRock, Inc., the world's largest asset manager, said Tuesday that it has agreed to buy the European private equity arm of global reinsurance behemoth Swiss Reinsurance Company.
While the terms of the transaction were not disclosed, the Zurich-based Swiss Re subsidiary manages investments worth more than $7.5 billion in total. BlackRock will combine the business, Swiss Re Private Equity Partners AG, with its own private equity arm to form a unit with roughly $15 billion in commitments combined. The all-cash deal, which is expected to close by the end of the third quarter, would also establish BlackRock's private equity presence in Switzerland, while expanding in Asia and Europe.
The deal between BlackRock and Swiss Re also includes an agreement to enter a strategic relationship based around Swiss Re's ongoing investments in the private equity arm being sold, and their eventual management by BlackRock.
Ropes & Gray is advising BlackRock on the acquisition, with private equity partner William Mone and investment management partner Bryan Chegwidden leading the way. Chegwidden, the co-leader of the firm's investment management group, frequently advises BlackRock's private equity unit on a variety of matters, including the formation of investment vehicles, according to his bio on the firm's Web site.
BlackRock's general counsel is Matthew Mallow, a former partner at Skadden, Arps, Slate, Meagher & Flom.
Swiss law firm Bär & Karrer is acting as outside counsel to Swiss Re in connection with the sale of its private equity arm. Corporate senior partner Thomas Reutter, based in Zurich, is leading that firm's team.
Meanwhile, New York-based Kirkland & Ellis private equity partner Daniel Lavon-Krein is leading a team from the firm advising Swiss Re on aspects of its strategic relationship agreement with BlackRock. Hong Kong–based corporate partner Nicholas Norris is also advising Swiss Re on Hong Kong issues related to the sale.
Hermann Geiger is group general counsel for Swiss Re.
Reuters notes that the acquisition by BlackRock is the latest in a recent string of deals in which private equity fund managers have switched hands. Earlier this week, HarbourVest Partners agreed to pay $1.4 billion for a private equity portfolio belonging to rival Conversus Capital. Last month, France's AXA Private Equity purchased a $1.7 billion fund of funds portfolio from Citigroup.
Bloomberg reported on Thursday that recent departures from BlackRock's executive ranks will put an end to the money manager's aggressive acquisition strategy, and that BlackRock, which has grown from a boutique buyout shop to a manager of $3.7 trillion in investments in just over two decades, will now look to other areas of growth. Among those areas, according to Bloomberg, is BlackRock's alternative assets unit, which houses the manager's private equity arm and the newly-acquired Swiss Re business.
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