Barclays eyes up a stake in BlackRock
BARCLAYS was last night awaiting an offer from Bank of New York Mellon for Barclays Global Investors (BGI), as US firm BlackRock edged towards the brink of a cash-plus-equity deal for the asset management unit.
Barclays and BlackRock are in talks over a deal that would see the bank merge BGI with BlackRock and take a 20 per cent equity stake in the combined group.
Barclays president Bob Diamond, who will share in a $585m (£366m) windfall for employees if the deal goes through, would get one of two seats for Barclays executives on the board of the new entity, which would be the world’s largest money manager.
The deal would also see investors from the Middle East provide financial backing, with the Qatar Investment Authority, a major Barclays investor, among parties in discussions over providing BlackRock with $3bn (£1.9bn) in exchange for a 12 per cent stake.
But Bank of New York Mellon is mulling a counter bid, which would have to be made before the period in which Barclays can take offers ends on 18 June, a condition of its initial agreement to sell BGI’s exchange traded funds unit iShares to CVC Partners for $4.2bn.
BGI has been valued at around $13bn. A merger between BlackRock with Barclays Global Investors (BGI) will create the world’s largest asset manager with funds under management of more than $2 trillion ($1.24 trillion).
The merger would catapult the new entity to the top of the pile of money managers by assets under management, a list currently headed by State Street Global Advisors.
BlackRock, led by chief executive Larry Fink is the world’s second-largest asset manager, with funds worth $1.28 trillion, while BGI occupies seventh place with just over $1 trillion.