BlackRock Cuts First Private Equity Deal for Authentic Brands

August 12, 2019 | News, Private Equity
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BlackRock becomes the largest stakeholder in a company with a powerful portfolio of global brands.

BlackRock announced over the weekend that it scored a 30% stake in Authentic Brands. 

The deal means that BlackRock’s portfolio will now include a stake in Sports Illustrated, Nine West, Aeropostale, and Juicy Couture. In addition, Authentic owns more than 50 brands. It also owns the celebrity likeness to Muhammad Ali, Elvis Presley, Shaquille O’Neal, and Marilyn Monroe, according to the firm’s website.

The $875 million investment will make BlackRock the largest shareholder in Authentic Brands, which has a valuation of $4 billion.

BLK Enters Private Equity

It’s worth noting that this was the first investment by BlackRock’s new private equity fund. In April, the asset manager launched Long Term Private Capital after $2.75 billion. Back when Blackrock announced the fund, managing director André Bourbonnais discussed the benefits of LTPC’s model.

“There’s a large population of strong, stable companies with a reciprocal need for a long-term private ownership model,” Bourbonnais said in a statement. “For these companies, neither a public listing nor a leveraged buyout is an attractive option. LTPC is aligned to meet those needs.”

Private equity firms had backed Authentic for some time. Existing shareholders include Brookfield Properties, Leonard Green & Partners, General Atlantic, Lion Capital, and Simon Property Group.

Finally, Authentic Brands Group CEO Jamie Salter told CNBC his family will still control 20% of the firm after the deal. He said that they cut this deal to establish a long-term relationship with Blackrock of “more than 10 years,” according to CNBC’s Brian Sullivan.

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