Blackrock Takes Remaining Stake in SpiderRock Advisors

BlackRock has agreed to buy the remaining equity interest in SpiderRock Advisors (SRA), a provider of option overlay strategies for the US wealth market. The deal expands Blackrock’s footprint in separately managed accounts (SMAs), a rapidly growing part of the wealth business.

Financial terms of the deal, which is expected to close in the second quarter, were not disclosed.

Blackrock initially acquired a minority position in Chicago-based SpiderRock in 2021, which managed around $4.8 billion in assets as of February. The firm’s SMA strategies, which use derivative overlay tactics to manage income and risk for single stocks and diversified portfolios, are available through RIAs, family offices, national broker/dealers, and institutional channels.

“By giving BlackRock more SMA capabilities, this acquisition will enable us to meet growing demand from wealth managers for personalized, tax-efficient portfolios,” said Joe DeVico, co-Head of BlackRock’s U.S. wealth advisory business. “We look forward to fully integrating SRA’s team and capabilities into our U.S. Wealth Advisory business and to further expanding our offerings in SMA solutions.”

BlackRock managed $186 billion in SMAs as of December 2023. The firm’s SMA franchise specializes in providing customized strategies, including Aperio’s direct indexing capability, actively managed fixed income, and equity and multi-asset strategies.

The firm, citing research from Cerulli Associates, anticipates that SMAs will grow to $4 trillion in assets under management by 2026 from $2.7 trillion as of the third quarter of 2023.