![]() ![]() Instead of selling iShares to CVC, Barclays should sell all of BGI to BlackRock, said Kapito, in return for a big slug of money and stock in the combined company. Both were members of the group of executives picked by Fink and Ralph Schlosstein in 1998 to help them create the new investment firm that became BlackRock © Mark Peterson/Redux/eyevine “Do you want to play checkers, or do you want to play chess?” BlackRock’s president asked Diamond, and presented his proposal.įink (centre) with Susan Wagner and Robert Kapito in 2009. Diamond agreed, and the two went for a walk. He rushed up to Barclays’ corporate box, knocked on the door and asked Diamond to come out for a chat. The Yankees lost to Cleveland that night, but Kapito missed the entire game. This gave BlackRock an opening - but one it had to seize quickly. Crucially, the agreement included a 45-day “go-shop” provision, which permitted Barclays to talk to other people who might be interested in topping CVC’s offer. In early April, Barclays accepted a $4.2bn offer from CVC, a London-based private equity firm, for BGI’s rapidly growing exchange-traded fund (ETF) unit, iShares. It was even willing to sell it off piecemeal. ![]() That meant it was open to selling the family silver, including its pioneering asset management arm Barclays Global Investors. By early 2009, Barclays was scrambling to raise money and avoid a UK government bailout. So he scalped a ticket and made his way to the Bronx.īarclays had taken a plunge by acquiring the US parts of Lehman Brothers when the investment bank imploded in 2008, but the deal quickly became a deadweight dragging the British bank down as well. Bob Diamond, the chief executive of Barclays Capital, was watching the game from his corporate box at the stadium, and Kapito needed an urgent, discreet chat with his old friend. Kapito was on a secret mission that would not only transform the fortunes of his employer, the investment group BlackRock, but change the face of the financial industry. But the balding former bond trader was not there to watch a game of baseball. The economy was in a shambles, after the US mortgage crisis had rocked the global financial system, and many Wall Streeters were desperate for distractions. On April 16 2009, Rob Kapito went to the newly built Yankee Stadium, where the pride of New York was taking on the Cleveland Indians. ![]()
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