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Barclays bond index unit, which tracks assets with market value of $13 trillion, hits market; may fetch $400 million: sources

Barclays bond index unit hits market; may fetch $400 million: sources

NEW YORK – Barclays Plc has launched a long-anticipated sale process for its Index, Portfolio and Risk Solutions (IPRS) business, which could yield around $400 million for the UK bank, according to people familiar with the matter.

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1 HOUR 54 MIN AGO

NEW YORK – Barclays Plc has launched a long-anticipated sale process for its Index, Portfolio and Risk Solutions (IPRS) business, which could yield around $400 million for the UK bank, according to people familiar with the matter.

A process for the unit kicked off in early June with indications of interest from prospective bidders due later this month, the people said this week, asking not to be named because the matter is not public.

The business has attracted preliminary interest from several parties, including MSCI Inc, Standard & Poor’s , FTSE, Markit Ltd , Bloomberg LP and Thomson Reuters Corp , Interactive Data Corp the people added.

Reuters first reported in November that Barclays began exploring options for the index business following an approach from MSCI, another index business.

A Barclays spokesman declined to comment. Representatives for MSCI, Markit, Bloomberg and Thomson Reuters did not immediately respond to requests for comment. Representatives from FTSE, Standard & Poor’s and Bloomberg declined to comment.

The index business Barclays intends to sell includes a basket of over 98 major indexes, according to its website. The U.S. Aggregate Bond Index, which Barclays bought as part of the Lehman Brothers acquisition during the financial crisis, is among the platform’s best-known offerings.

The index business, known as a market leader, would attract a wide range of buyers such as equity indexes, and investment houses with distribution platforms, people familiar with the matter have said.

But other index providers are also looking to ramp up their offerings. FTSE, which is owned by the London Stock Exchange Group Plc and is one of the dominant index providers in Europe, has said it wants to increase its U.S. presence substantially.

In addition, the risk solutions side of the business unit has software tools used by institutional investors to perform analysis of their holdings. The two sides of the business are seen as compatible and would not need to be split prior to a potential acquisition, the people said. REUTERS

 

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KB Kee is the Managing Editor of the Moat Report Asia (www.moatreport.com), a research service focused exclusively on highlighting undervalued wide-moat businesses in Asia; subscribers from North America, Europe, the Oceania and Asia include professional value investors with over $20 billion in asset under management in equities, some of the world’s biggest secretive global hedge fund giants, and savvy private individual investors who are lifelong learners in the art of value investing. KB has been rooted in the principles of value investing for over a decade as an analyst in Asian capital markets. He was head of research and fund manager at a Singapore-based value investment firm. As a member of the investment committee, he helped the firm’s Asia-focused equity funds significantly outperform the benchmark index. He was previously the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. KB has trained CEOs, entrepreneurs, CFOs, management executives in business strategy, value investing, macroeconomic and industry trends, and detecting accounting frauds in Singapore, HK and China. KB was a faculty (accounting) at SMU teaching accounting courses. KB is currently the Chief Investment Officer at an ASX-listed investment holdings company since September 2015, helping to manage the listed Asian equities investments in the Hidden Champions Fund. Disclaimer: This article is for discussion purposes only and does not constitute an offer, recommendation or solicitation to buy or sell any investments, securities, futures or options. All articles in the website reflect the personal opinions of the writer.

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