Blackstone (BLK.US) is set to acquire private credit group HPS Investment for nearly $12bn.

According to media reports, the world's largest asset manager BlackRock (BLK.US) is trying to compete in the fast-growing alternative investment sector by being close to an agreement to acquire private credit group HPS Investment Partners. The media quoted insiders as saying that the two sides have agreed on the general framework of the deal and are aiming to announce the overall terms after the Thanksgiving holiday.

HPS has been committed to an IPO earlier this year, with an estimated valuation of about $10bn. Two insiders said the final price would be close to $12bn.

Representatives of BlackRock declined to comment. HPS did not respond to a request for comment.

Earlier in October, it was reported that the negotiations between BlackRock and HPS had entered a deep stage. HPS may still choose IPO or sell minority shares if the two sides fail to agree on the valuation.

As of the end of the third quarter, BlackRock managed $11.5tn in assets. If the deal is done, BlackRock will have over $500bn in alternative assets. HPS manages over $100bn in funds and is one of the largest independent managers in the booming private credit market.