Bank of America Corp. is shedding its remaining interest in asset manager BlackRock for $2.55 billion.
BlackRock has agreed to repurchase 13.6 million of its Series B convertible preferred shares for $187.65 apiece, a 2.9% discount to the stock's Wednesday closing price, the asset manager said in a press release Thursday. BlackRock said it expects the transaction to be "immediately accretive" to earnings.
BofA inherited the BlackRock stake through its 2008 purchase of Merrill Lynch & Co., which had merged its investment management arm with BlackRock two years earlier. That deal gave Merrill a 49.8% stake in the money manager. B of A had already sold off part of its stake, and was expected to fully divest out of BlackRock as it worked to shed non-crucial assets and focus on core businesses.
Tom Montag, president of BofA's global banking and markets group, will continue to serve on BlackRock's board, however.
BlackRock said it expects to fund the purchase through available cash, commercial paper and medium- and long-term debt. The transaction is expected to close June 1.