BlackRock to buy Cachematrix as it widens use of Aladdin system
BlackRock has said it will buy Cachematrix, a fintech firm whose software enables companies to manage their cash and short-term debt. The deal offers the world's biggest asset manager the opportunity to expand its Aladdin investment operating system to Cachematrix's client list – including Bank of America, Morgan Stanley and HSBC – for whom the Denver-based firm helps manage $200bn. Days earlier, BlackRock said it would acquire a stake in digital investment firm Scalable.
Larry Fink, Chief Executive Officer of BlackRock, takes part in the Yahoo Finance All Markets Summit in New York Thomson Reuters

BlackRock, the world's biggest asset manager, on Tuesday said it would buy a software company that helps businesses invest their cash, marking its second investment in a technology firm this month.

The investment giant with oversight of $5.4 trillion in assets will buy Denver-based Cachematrix Holdings LLC in a deal slated to close next quarter, according to a statement by both companies. Terms were not disclosed.

Cachematrix builds a software tool that banks can provide to corporate treasurers managing the cash and short-term debt they hold. Investments can be made in money-market funds provided by BlackRock and rival money managers, such as Fidelity Investments, Goldman Sachs Group Inc and Charles Schwab Corp.

Just last week, BlackRock said it would take a stake in Scalable Capital, a European digital investment manager.

The deals come two months after BlackRock Chief Executive Officer Larry Fink told Reuters he was considering up to four small acquisitions to shore up the New York-based company's technology and investment expertise.

Fink has placed an unusual emphasis on technology for a company in his industry, including through the company's Aladdin operating system for investment management, which it licenses to rivals.

The latest deal gives BlackRock a new stable of bank clients and pushes Aladdin further into the business of advising companies on how to invest their cash. In a statement, BlackRock said it plans to combine some of Cachematrix's features with Aladdin.

On its website, Cachematrix lists Bank of America Corp , Morgan Stanley and HSBC among its clients and reports assisting with $200 billion of client assets.

Banks trying to meet strict requirements intended to prevent another financial crisis have been looking to shed deposits that would require them to hold more capital. Businesses have been eager to find places to put cash as ultra-easy monetary policy has pushed yields on debt to historic lows.

BlackRock in 2015 expanded its reach in the business of managing large institutions' cash and short-term investments when it acquired the money-market fund business run by Bank of America. BlackRock's cash business included nearly $400 billion in assets at the end of March.