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Barclays PLC (“Barclays”) yesterday agreed to sell Barclays Risk Analytics and Index Solutions Ltd. (“BRAIS”) to Bloomberg for approximately £520m(1).
BRAIS incorporates Barclays‟ benchmark indices, including the Barclays Aggregate family of indices. The transaction incorporates 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 out-sourced to Bloomberg.
The pre-tax gain to be recognised on completion of the transaction is expected to be approximately £480m and is estimated to result in a proforma increase of c.10 bps on the 30 September 2015 CET1 ratio. Given the nature of the BRAIS business it will have a negligible impact on RWAs.
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.”
(1) $790m at USD/GBP rate of 1.52
