Fund management giant BlackRock has agreed to buy Bank of America’s $87bn money-market fund business.
Terms of the transaction were not disclosed. The deal is expected to lift the global cash-management business at BlackRock to about $372bn from $285bn.
Under the deal, BlackRock will manage the assets, which include money-market funds, separate accounts and other cash-management products, while Bank of America will continue to handle distribution.
Commenting on the deal, BlackRock co-head of global cash management Tom Callahan said: "Expanding our partnership with Bank of America presents a tremendous growth opportunity for BlackRock’s cash management business. This partnership allows us to further leverage our global scale, comprehensive product suite and best-in-class risk management capabilities to serve a new universe of clients.
"At a time of tremendous change in the cash management industry, this alliance underscores BlackRock’s commitment to market leadership in delivering outstanding liquidity solutions to our clients."
BofA Global Capital Management president Michael Pelzar said: "BlackRock is a best-in-class liquidity solutions provider with a demonstrated ability to deliver on clients’ needs for liquidity and yield.
"Our selection of BlackRock was made after careful consideration of our clients’ needs, our long-standing relationship with BlackRock, and their demonstrated ability to provide a comprehensive range of global liquidity management solutions."
The deal is expected to close next year, subject to standard approvals, BlackRock said in a statement.