FERC approval of BlackRock GIP acquisition threatens fair energy market

The U.S. Federal Energy Regulatory Commission (FERC) has approved BlackRock’s $12.5 billion acquisition of private equity firm Global Infrastructure Partners (GIP), BlackRock’s largest acquisition in 15 years. As part of the deal, BlackRock will pay $3 billion in cash and issue approximately 12 million of its shares. Global Infrastructure Partners is the world’s largest independent infrastructure manager with over $100 billion in AUM, known for investing in energy, transportation, digital infrastructure, and water management sectors.

The Private Equity Stakeholder Project previously submitted joint protests to FERC urging the agency to not approve the acquisition application. The protest filings can be found here, here, and here.

Below is the statement on the FERC approval from Alissa Jean Schafer, Climate Director at PESP.

“The Private Equity Stakeholder Project disagrees with FERC’s approval of BlackRock’s acquisition of Global Infrastructure Partners. The proposed transaction should concern investors and energy customers alike, as the merger would deepen BlackRock’s influence over critical energy infrastructure, potentially threatening fair competition.

“This acquisition will mark BlackRock’s shift from a passive investor to an active owner of energy infrastructure assets which leads to potential conflicts of interest. For instance, BlackRock already holds significant voting shares in several large utilities. BlackRrock’s CEO has made it clear that the GIP acquisition is designed to grow BlackRock’s private infrastructure business substantially.

“BlackRock’s control over large public utilities and the expansion of its infrastructure portfolio pose risks to market competition. The transaction would give BlackRock active control over key energy market assets, potentially affecting rates and regulatory oversight, particularly through its intertwined relationships with public utilities​.

“BlackRock has failed to address how it can effectively separate its passive ownership in utilities from its active management of energy assets, raising concerns around prioritizing its income over fair regulation.”