PNC Financial Services Group Inc plans to sell its entire 22% stake in the world's largest asset manager BlackRock Inc , the U.S. bank said on Monday, exiting one its most attractive investments after more than two decades.
), the U.S. bank said on Monday, exiting one its most attractive investments after more than two decades.
PNC, BlackRock’s largest shareholder, will sell its common and preferred shares in a secondary offering and BlackRock will repurchase $1.1 billion in common shares, assuming the sale goes well. The divestment puts an end to longstanding questions about when PNC would sell its lucrative position that had over time become a burden amid tighter capital regulations.Edward Jones analyst Kyle Sanders said besides the regulatory pressure, PNC may want additional liquidity to deal with the economic downturn caused by the coronavirus pandemic.
“The sale of BlackRock shares likely signals that PNC is looking to make a sizeable deal during a period of market disruption, which is consistent which their actions in the past,” Sanders said. During the 2008 financial crisis, PNC had acquired National City Corp in an opportunistic way.
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