BlackRock Inc. BLK has obtained a commercial license to conduct operations in Abu Dhabi, as reported by Bloomberg. This will, thus, expand its regional presence.

BLK’s Rationale Behind This Move

Abu Dhabi and Riyadh have been competing with Dubai to establish themselves as the primary business hub of the Middle East. Abu Dhabi and Riyadh control more than $1 trillion in sovereign wealth each, establishing them among the largest pools of capital globally.

Per Charles Hatami, head of the Middle East for BlackRock, “Abu Dhabi has rapidly transformed into a global financial center. Its strategic location, proactive government policies, and commitment to sustainable growth make it an ideal location for capital markets.”

BlackRock’s CEO Larry Fink aims to capitalize on this opportunity by conducting operations in both countries. In sync with this, the company also intends to seek regulatory approval to engage in business in the Abu Dhabi Global Market, the city’s financial center. This new office will enable the company to work closely with sovereign wealth funds, wealth managers and investment vehicles based in Abu Dhabi.

BLK has been increasing its efforts to grow in the Saudi Arabian kingdom. Last month, the company obtained approval from Saudi Arabia to establish regional headquarters in Riyadh. Further, the company announced it would receive up to $5 billion from the Public Investment Fund to invest in the Middle East and develop a Riyadh-based investments team.

BlackRock’s Zacks Rank & Price Performance

Year to date, shares of BlackRock have gained 29.3% compared with the industry’s 37.5% growth. 

Image Source: Zacks Investment Research

Currently, BLK sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Expansion Initiatives by Other Finance Firms

Earlier this month, AllianceBernstein L.P. AB entered into a partnership with Reinsurance Group of America, Incorporated RGA to expand its insurance business.

AB has been selected as one of the leading investors in Ruby Reinsurance Company, a reinsurance sidecar vehicle sponsored by RGA. It focuses on the U.S. asset-intensive market. AB plans to manage private alternative assets for RGA’s general account through this transaction.

Similarly, Apollo Global Management Inc. APO extended its multi-billion-dollar partnership with Mubadala Investment Company, which is focused on global origination opportunities.
 
This strategic move will further bolster APO’s Capital Solutions business and augment its ability to originate investment opportunities across asset classes.

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