BlackRock founder Larry Fink smelled an opportunity to take over parts of Credit Suisse at a bargain basement price.
In the hectic hours before the emergency rescue of UBS by Credit Suisse, Blackrock's name circulated briefly as a possible savior. The American asset manager took a hand in the poker game for the beleaguered Credit Suisse.
Former Swiss National Bank President and current Blackrock vice-Chairman Philipp Hildebrand was mentioned as perhaps being able to act as a mediator between the Swiss government and the two banks. Financial industry observers also speculated that Hildebrand could take a role on the board of directors of the merged bank.
Bid From Blackrock
As the «Financial Times» (behind paywall) reported Wednesday, Blackrock founder Larry Fink sent Credit Suisse First Boston veteran Rob Kapito, not Hildebrand, to see if a deal could be reached.
Talks with Blackrock were broken off after it indicated that it did not want to buy Credit Suisse in its entirety. At the same time, Blackrock also had no great interest in upsetting UBS, as there are numerous business relationships between the two institutions.
From a Swiss perspective, it is noteworthy there was at least one interested party for a partial sale of Credit Suisse, which would have effectively played out the scenario of a spin-off of the Swiss unit.
Instead of a breakup, the emergency rescue resulted in a private-sector takeover by UBS with liquidity support from the Swiss National Bank and government guarantees.
Shifting Sands of Crisis
It is anyone's guess why Blackrock or another bidder did not make the cut. One factor could have been that US and UK supervisory authorities were opposed to a partial sale because the smoldering fires could then have shifted to their regions.
Rise for Blackrock
Blackrock would have had a rare opportunity to move into a new league in wealth management with the purchase of Credit Suisse. Blackrock is the world's largest provider of investment products sold primarily to institutional investors, but compared to rivals, it lacks wealth management which made acquiring Credit Suisse attractive.
Fink has long been rumored to be looking for a big deal, with a foray into alternative investments seen as likely.
Last year Blackrock was said to be considering a move into the private equity group Carlyle. However, the company was thrown into chaos by the sudden departure of Chief Executive Kewsong Lee.
