Jeddah, Saudi Arabia – Private equity powerhouse BlackRock made a big $875 million investment and become the largest shareholder of a company that owns Sports Illustrated, Nine West, Juice Couture and dozens of other brands.
The deal, which was first reported Sunday by the Wall Street Journal, closed on Friday, a BlckRock (BLK) spokesperson confirmed to CNN Business.
The investment is the first BlackRock’s new private-equity fund, Long Term Private Capital, which the company said in April was ready to start investing after securing $2.75 billion. That fund will account for $625 million of the total investment in Authentic Brands Group.
BlackRock is the world’s largest asset manager and some analysts think its new fund could change the landscape of private-equity investing. Most private-equity funds are expected to generate relatively short-term returns for investors through a buyout of public listening. But the Long Term Private Capital fund will provide “long-term private ownership” for “strong, stable companies”, the fund’s managing director Andre Bourbonnais said in a statement in April.
Authentic Brands Group was founded by CEO Jamie Salter in 2010. The company now owns 50 brands, including Juicy Couture and Aeropostale, that account for $9.3 billion in annual retail sales. In May, it purchased the brad intellectual property of Sports Illustrated for $110 million from Meredith Corporation.
The BlackRock spokesperson declined to comment on the valuation of Authentic Brands Group but the Wall Street Journal reports the deal values the company at $4 billion including debt, according to people familiar with the matter.