16th Dec 2015 13:08
LONDON (Alliance News) - Barclays PLC on Wednesday said it expects to benefit from a GBP480.0 million pretax gain after agreeing to sell its benchmark indices business to Bloomberg LP.
Barclays Risk Analytics and Index Solutions Ltd was sold for about GBP520.0 million, the London-listed bank said in a statement, with the deal estimated to boost its CET1 ratio - a key measure of capital and financial strength - by about 10 basis points on proforma basis from the level seen at the end of September.
The unit's benchmark indices span global markets covering multiple asset classes, most notably the Barclays family of aggregate bond indices.
Barclays will retain its quantitative investment strategy index business, with calculation and maintenance of its strategy indices outsourced to Bloomberg.
"We are pleased to partner closely with Bloomberg upon completion of the transaction, including maintaining a co-branding arrangement on the benchmark indices for an initial term of five years," Chief Executive Jes Staley said in a statement.
"This transaction is further evidence of the good work we are doing in managing down our non-core assets so that shareholders can feel the full benefit of ownership of Barclays' well-performing core businesses," Staley said.
Completion is subject to various conditions, including anti-trust approval, and is expected to occur by mid-2016.
"As financial markets continue to evolve, our clients need and expect the index business to evolve too," Michael Bloomberg, the founder and chief executive of Bloomberg LP, said in a statement.
"Combining the market-leading Barclays indices and their superb team with our data management, analytics and distribution will provide more independence, liquidity and transparency to the marketplace, improve industry innovation and further meet the diverse needs of our global client base," Bloomberg added.
Shares in Barclays were up 0.4% at 215.65 pence on Wednesday afternoon.
By Samuel Agini; [email protected]; @samuelagini
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