Millennium in early talks to sell an equity stake to BlackRock

The Blackrock headquarters in New York, US, on Friday, Oct. 11, 2024. BlackRock shares rise roughly 2% in Friday premarket trading after the investment firm’s assets under management beat the average analyst estimate in the third quarter.

BlackRock Inc. is in talks with Izzy Englander’s Millennium Management to take a minority stake in his $70 billion hedge fund, according to people familiar with the matter.

The discussions are in the early stages and may not result in a deal, said the people, who asked not to be identified because the talks are confidential. Representatives for both firms declined to comment.

The Financial Times reported on the talks earlier.

Millennium, one of the world’s largest hedge funds, has never sold a portion of its business to a third party. The firm has backed smaller hedge funds. Last year, it was in talks with Schonfeld Strategic Advisors for a partnership agreement, before they fell apart months later.

BlackRock, the world’s biggest asset manager, has expanded aggressively into alternative assets over the past year, an effort by Chief Executive Officer Larry Fink to transform the company into a one-stop shop for stocks, bonds and private strategies, as well as financial consulting for strategic and governmental clients.

Millennium’s assets have also been growing. This year, as the firm sought to raise as much as $10 billion of new cash for its hedge fund, it found that investors wanted to give twice that amount. It still told clients that it will stick with the initial cap.

Private assets and alternative hedge funds still constitute a small fraction of BlackRock’s $11.5 trillion of assets and $4.2 trillion of exchange-traded funds, but they typically charge higher fees, boosting revenue and profits for the firm. BlackRock now manages roughly $450 billion of alternative assets, putting it closer to industry leaders such as Blackstone Inc., Apollo Global Management Inc. and KKR & Co.