Last Wednesday British bank Barclays agreed to sell its indexing business built around former Lehman Brothers benchmarks to US based Bloomberg for close to 781 million US dollars (520 million pounds).
The move comes as Chief Executive Officer Jes Staley speeds up non-core disposals and will give Barclays a 480 million-pound gain.
Barclays Risk Analytics and Index Solutions Ltd. (BRAIS) incorporates Barclays’ benchmark indices, including the Barclays Aggregate family of indices. The transaction includes the sale of relevant intellectual property in relation to the POINT portfolio analytics tool. Barclays has agreed to continue to operate POINT for 18 months post completion in order to help clients transition to other providers, including Bloomberg’s PORT product. Barclays will retain its quantitative investment strategy index business, with calculation and maintenance of its strategy indices outsourced to Bloomberg.
Completion is subject to various conditions, including anti-trust approval, and is expected to occur by mid-2016.
Jes Staley, Barclays Group CEO, said: “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. 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.”
Back in 2008 Barclays combined their indices offering with those of Lehman Brothers Holdings Inc.’s North American unit to create BRAIS.