Barclays PLC has agreed to sell its market leading iShares business to a European buyout fund for $4.4 billion.
iShares is the largest manager of ETFs in the U.S. with $232 billion in assets across 180 funds. As of the end of March, iShares had a 48% market share, more than the next 3 managers combined – #2 State Street was at 27%, #3 Vanguard was at 9% and #4 ProShares was at 5%.
The acquirer is CVC Capital Partners Group, a Luxembourg-based private equity and investment advisor that currenlty owns 52 companies employing 447,000 people worldwide.
The majority of iShares’ 620 employees, including key managers Lee Kranefuss, Mike Latham and Rory Tobin, are expected to transfer with the iShares business. Barclays will retain ownership of Barclays Global Investors which continues to be one of the world’s largest asset managers.
Barclays has until June 18 to find a better offer and the deal is expected to close in November 2009.