TLDR
- Blackstone is introducing a publicly traded entity to acquire AI data centers, with a goal of raising tens of billions in capital.
- Initial funding is being sought from sovereign wealth funds and institutional investors.
- Both Blackstone and Brookfield have made offers of at least €8 billion for Volkswagen’s heavy diesel engine division, Everllence SE.
- A co-funding agreement was established between Blackstone Life Sciences and Johnson & Johnson to progress the AML cancer treatment bleximenib.
- On February 23, RBC Capital began coverage with an Outperform rating and a $179 price target.
The alternative asset manager is introducing a new publicly traded acquisition entity dedicated to purchasing AI data centers. The objective is to provide retail investors with entry into the AI infrastructure sector—a market Blackstone aims to lead.
The company is commencing its efforts by securing capital from sovereign wealth funds and institutional investors. Subsequently, it intends to attract tens of billions from a wider investor base.
This is a bold initiative, although some question if the timing is optimal.
Certain investors have expressed worries that large-scale AI training facilities constructed in remote locations may become outdated as technology advances. Blackstone is directly confronting this debate.
This action is a component of a larger strategy to expand beyond its conventional clientele of pensions and endowments. Retail investors are becoming an increasingly important target.
Volkswagen Unit Bid
In deal news, Blackstone and Brookfield Asset Management (NYSE: BAM) have each submitted bids of at least €8 billion ($9.4 billion) for a controlling interest in Volkswagen’s Everllence SE unit.
Everllence manufactures ship engines and turbines for power plants. Volkswagen has been seeking to divest the business as part of a plan to simplify operations and enhance profitability.
Other contenders that have progressed to the next bidding round include Advent International, Bain Capital, EQT AB, and CVC Capital Partners.
A transaction is not assured. Sources familiar with the matter told Bloomberg that discussions are continuing.
Biotech and Analyst Coverage
Blackstone Life Sciences revealed a co-funding pact with Johnson & Johnson on February 23 to further the clinical development of bleximenib, an experimental oral medication for acute myeloid leukemia.
AML is the most frequent acute leukemia in adults and has the poorest survival rate of all leukemia varieties. Company management characterized it as a very challenging disease to treat.
This co-funding deal marks the first of its kind between BXLS and Johnson & Johnson, representing a significant achievement for Blackstone’s life sciences division.
Also on February 23, RBC Capital commenced coverage of Blackstone, assigning an Outperform rating and a $179 price target.
RBC informed investors that Blackstone possesses a “first-mover advantage” for being the initial alternatives firm to establish a private wealth team. The bank views the company as well-positioned to benefit long-term from the expansion of retail investing and a rebounding real estate market.
Blackstone’s business is organized into four segments: Real Estate, Private Equity, Credit and Insurance, and Hedge Fund Solutions.
BX shares declined by 3.88% on February 27, the day the AI data center and Volkswagen news emerged.
