Published Date:
17 June 2009
By victoria thomson
BANKING giant Barclays last night formally disclosed that it had accepted a $13.5 billion (£8.2bn) offer for its fund management arm from US suitor BlackRock.
The bank will hold a shareholder meeting in August to approve the deal for its Barclays Global Investors (BGI) business.
It will also pay a $175 million break fee to CVC, the private equity firm which previously agreed to buy iShares – part of the BGI business.
More than 400 Barclays staff are to share £380m through the deal with US fund management giant BlackRock.
Bob Diamond, Barclays president and investment banking boss, will pick-up a £22m profit before tax on his stake, having forked out £6m on shares over the past six years.
The deal will also significantly bolster Barclays' financial strength, making it "one of the most capitalised banks in the world", according to the group's chief executive John Varley. Under the deal, Barclays will end up with a near-20 per cent stake in New York-based BlackRock.
BlackRock is paying $6.6bn in cash and the rest in stock.
To help fund the cash payment it is raising $2.8bn from the sale of 19.9 million shares to a group of unnamed institutional investors.
The full article contains 214 words and appears in The Scotsman newspaper.
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Last Updated:
16 June 2009 9:05 PM
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Source:
The Scotsman
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Location:
Edinburgh
