BlackRock to Buy $4.8B SpiderRock Advisors to Boost SMA Business

BlackRock announced early Friday that it has agreed to acquire the remaining equity interest in SpiderRock Advisors, a firm managing nearly $5 billion in one of the fastest-growing product segments in the U.S. wealth industry: separately managed accounts.

The financial terms of the deal were not disclosed. The firm’s announcement states the transaction is expected to close in the second quarter, while the financial impact of the transaction is “not material to BlackRock earnings.”

The full acquisition of SpiderRock comes about two and a half years after BlackRock first acquired a minority stake in the provider of customized option overlay strategies in the U.S. wealth market.

Data from Cerulli Associates shows SMAs are expected to grow from $2.7 trillion in assets today to $4 trillion by 2026. The anticipated growth is fueled by a fundamental client need, according to BlackRock, to customize portfolios for tax management, values alignment or other investment outcomes.

“By giving BlackRock more SMA capabilities, this acquisition will enable us to meet growing demand from wealth managers for personalized, tax-efficient portfolios,” said Joe DeVico, co-head of BlackRock’s U.S. wealth advisory business. “We look forward to fully integrating SRA’s team and capabilities into our U.S. wealth advisory business and to further expanding our offerings in SMA solutions.”