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BlackRock, the world’s largest money management firm, has entered the private equity field by hiring three veteran private equity industry veterans. George A. Bitar, Mandakini Puri and Nathan Thorne, all previously with Merrill Lynch Global Private Equity, have joined BlackRock as Managing Directors of BlackRock Global Private Equity. A part of BlackRock Alternative Investors (BAI), BlackRock Global Private Equity is projected to employ approximately 20 private equity professionals within the next year.
As of March 31, 2011, BAI represented $115.3 billion of assets under management. This figure is inclusive of holdings in real estate, hedge funds, hedge funds of funds, private equity funds of funds, commodities, currencies and opportunistic investment vehicles.
BlackRock Global Private Equity will operate alongside the existing BlackRock Private Equity Partners. Founded in 1999, BlackRock Private Equity Partners is a firm focused on venture capital, growth capital, private equity funds of funds and other like investments. It is currently headed by Russell Steenberg.
Bitar, Puri and Thorne co-founded Merrill Lynch Global Private Equity in 1994 but left the firm after it was acquired by Bank of America in 2009. At Merrill Lynch Bitar, Puri and Thorne were involved with major private equity investments involving the British retailer Debenhams plc, the automobile rental company Hertz Global Holdings Inc., and several others. At BlackRock the team will report directly to BAI head Matthew Botein.
BlackRock’s Fink Tops CEO Pay
BlackRock’s CEO, Larry Fink, was recently listed on top of Bloomberg’s Finance 50 of highest paid Wall Street CEOs, pulling in $23.8 million in salary and stock in 2010. John Strangfeld, CEO of Prudential Financial Inc., came in second with $22.6 million in compensation. AON Corp. head Gregory Case rounded out the top three with $20.8 million.
Fink received a 50 percent raise in pay over the previous year even though BlackRock lost 16 percent in stock value in 2010. The stock recorded a net gain of 77 percent in 2009, its best year on Wall Street since 2000.
Despite BlackRock’s lackluster stock performance in recent months (the stock is up 1.3 percent year to date in 2011 as of May 23), Fink’s pay increase is indicative of pay increases across the board among Wall Street executives after two years of cuts in the face of criticism from the public and from Congress.
While average compensation was down 19 percent in 2008 and 21 percent in 2009 among CEOs who held the same job the year before, it increased by 26 percent in 2010. Analysts credit this to short memories among the general public, stockholders, politicians and the media, noting that we are no longer in a climate of bailouts and imminent failures of major banks.
