Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

BlackRock makes technology deal in cash management business

Published 06/27/2017, 11:35 AM
Updated 06/27/2017, 11:35 AM
© Reuters.  BlackRock makes technology deal in cash management business

© Reuters. BlackRock makes technology deal in cash management business

By Trevor Hunnicutt

(Reuters) - BlackRock (N:BLK), the world's biggest asset manager, on Tuesday said it would buy a software company that helps businesses invest their cash, marking its second investment in a technology firm this month.

The investment giant with oversight of $5.4 trillion in assets will buy Denver-based Cachematrix Holdings LLC in a deal slated to close next quarter, according to a statement by both companies. Terms were not disclosed.

Cachematrix builds a software tool that banks can provide to corporate treasurers managing the cash and short-term debt they hold. Investments can be made in money-market funds provided by BlackRock and rival money managers, such as Fidelity Investments, Goldman Sachs Group Inc (N:GS) and Charles Schwab Corp (N:SCHW).

Just last week, BlackRock said it would take a stake in Scalable Capital, a European digital investment manager.

The deals come two months after BlackRock Chief Executive Officer Larry Fink told Reuters he was considering up to four small acquisitions to shore up the New York-based company's technology and investment expertise.

Fink has placed an unusual emphasis on technology for a company in his industry, including through the company's Aladdin operating system for investment management, which it licenses to rivals.

The latest deal gives BlackRock a new stable of bank clients and pushes Aladdin further into the business of advising companies on how to invest their cash. In a statement, BlackRock said it plans to combine some of Cachematrix's features with Aladdin.

On its website, Cachematrix lists Bank of America Corp (N:BAC), Morgan Stanley (N:MS) and HSBC (L:HSBA) among its clients and reports assisting with $200 billion of client assets.

Banks trying to meet strict requirements intended to prevent another financial crisis have been looking to shed deposits that would require them to hold more capital. Businesses have been eager to find places to put cash as ultra-easy monetary policy has pushed yields on debt to historic lows.

BlackRock in 2015 expanded its reach in the business of managing large institutions' cash and short-term investments when it acquired the money-market fund business run by Bank of America. BlackRock's cash business included nearly $400 billion in assets at the end of March.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.