BlackRock is ‘in the game’

If BlackRock sniffing around Credit Suisse wasn’t enough, Larry Fink just put Wall Street’s top dealmakers on notice: he wants to see flow. Big flow.

Here is an excerpt from today’s earnings call with analysts, via Sentieo/AlphaSense, and after a question about potential acquisitions from Credit Suisse analyst Bill Katz. FTAV’s emphasis below:

I look at the things that we’ve done in the past by expanding our products in a range, whether it was Efront transform Aladdin into a platform that is both unique and differentiated because it’s both public and private markets. I look at what we did with Aperio in terms of wealth management and the opportunity we have in tax strategies and direct indexing. I look at cash matrix and how that played a role with our money market funds in the last few months. And so it is through inorganic opportunities that we look at if we can expand our footprint. As I said in my prepared remarks, we are asking ourselves to reimagine BlackRock. What are the other big opportunities? Should there be a big opportunity as more and more organisations use technology? How can we double down on what we’re doing with Aladdin technology? How can we build out our footprint globally at this time. And so we’re looking across the board as there are issues.

. . . I believe BlackRock can play a role in some of these opportunities. And I think there was a quote sometime in the last few weeks about something I said to our team, I don’t know where it came from. But indeed, I did say it, I said to be in the game, we must play the game. And so we’re in the game. We’re across the board working with our clients across the board. We’re working with policymakers across the board. We are working with regulators worldwide. And we’re here to help. We’re here to advise. We’re here to navigate. And through all that, there is an opportunity for something inorganic and transformational. We’re going to be prepared to do something like that, but I’ll just leave it at that.

Alphaville wrote about the implications of BlackRock being in the CS mix last month. This is Fink stripping away any coyness. More than a decade after the BGI acquisition, he wants to do another big fat deal.

He even references the “to be in the game you’ve got to play it” quote that our mainFT colleagues reported he told BlackRock executives when ordering them to Zurich. The issue is now is figuring what exact game Fink wants to play, as he was annoyingly vague about it today.

Fundamentally, BlackRock is in the advisory business, so it’s not going to be buying a bank or something silly like that (surely?). We speculated on what Fink might be interested in last month’s post: private capital and wealth management.

The references to Aladdin (and the Efront acquisition) indicates that he’s also looking at technology, but it’s hard to see what might be truly “transformational” there. What else might fit the bill?