Barclays to Unload $6.1B BlackRock Stake

By Matt Egan Features FOXBusiness


British banking giant Barclays (BCS) unveiled plans on Monday to rid itself of a $6.1 billion stake in BlackRock (BLK), the world’s largest money manager.

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The move comes as financial-services companies around the world divest themselves of noncore assets and build cash levels ahead of looming capital rules aimed at preventing another financial crisis. 

London-based Barclays said it owns a 19.6% stake in BlackRock, including both common shares and Series B convertible preferred stock. This investment, which is almost three years old, has a market value of $6.1 billion, or 3.8 billion British pounds.

Shares of BlackRock, which is run by Wall Street titan Larry Fink and headquartered in New York, fell 1.63% to $169.10 Monday morning. The losses leave the stock down almost 5% on the year.

New York-listed shares of Barclays saw its shares rise 1.97% to $11.37, giving them a 2012 gain of 3% despite troubles in Europe. 

Barclays said BlackRock has agreed to buy back up to $1 billion of its stock from the British bank conditional on completion of the offering.

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The investment in BlackRock stems from the 2009 $13.5 billion cash-and-stock sale of Barclays Global Investors, a deal that cemented BlackRock’s status as the largest money manager in the world.

Barclays Capital, Morgan Stanley (MS) and Bank of America Merrill Lynch (BAC) are acting as joint bookrunners in the sale.