The pending blockbuster sale of Barclays Global Investors’ exchange-traded fund unit to a private-equity firm may signal the next growth phase for the ETF business. However, investors in the low-cost BGI’s iShares ETFs, most of which follow stock and bond indexes, are hoping it is business as usual.
Britain’s Barclays PLC earlier this month said it planned to sell its iShares ETF business to a limited partnership established by CVC Capital Partners Group, for about $4.4 billion.
Several questions have emerged in the wake of the deal, which is one of the largest transactions ever in the asset-management sector. Can the iShares business — the clear market-share leader in ETFs — continue to thrive under private equity’s umbrella? Should investors in iShares ETFs expect anything different, especially in fees? More generally, will the deal bring more mainstream firms into the ETF business and give the industry even more momentum to muscle in on mutual funds?
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