BlackRock said the acquisition of SSRM Holdings Inc. (SSRM), the holding company of the two units, is expected to enhance the firm’s investment management platform with additional US equity, alternative investment and real estate equity management capabilities, expanding the universe of products offered to institutional and individual investors worldwide. Additionally, BlackRock expects the deal to expand the scale and scope of the firm’s mutual fund products and distribution capabilities.
State Street Research is unrelated to State Street Corp.
Following the transaction, BlackRock will manage over $325 billion for institutional investors, including pension plans, corporations, insurance companies, banks and other financial services companies. As of July 31, BlackRock had $314 billion of assets under management.
BlackRock expects the combined firm to maintain significant presence in all of the cities in which SSRM currently operates, including Boston, San Francisco and Morristown, New Jersey.
Richard Davis, SSRM chief executive officer will join BlackRock’s management team to ensure a smooth integration of the two firms and to lead BlackRock’s expanded efforts in Boston. Similarly, Fred Lieblich, SSR Realty Advisors president and chief executive officer, is expected to continue to lead the real estate equity business of the combined firm.
Under the terms of the transaction, MetLife will receive at closing $325 million in cash and $50 million of BlackRock class A common stock. Additional cash consideration, which could increase the purchase price by up to 25%, may be paid over 5 years contingent on certain measures. In connection with this transaction, BlackRock and MetLife have agreed to enter into a cooperation agreement at closing to enhance and expand the products and services provided to the clients of SSRM, MetLife and BlackRock.
The transaction has been approved by the Boards of Directors of BlackRock and MetLife. Closing is expected in early 2005 pending required regulatory and fund shareholder approvals and satisfaction of other customary closing conditions.