Barclays iShares bidder search success

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May 11, 2009 11:36am ETF BASIC NEWS

ishares_logoLONDON (Reuters) – Barclays Plc’s (BARC.L) efforts to find more bidders for its iShares funds arm seem to have paid off, showing that prize assets can draw plenty of interest even in crisis-stricken markets.

Barclays said on Sunday it had received new interest from both trade and private equity buyers for iShares, after a report in the Sunday Times newspaper said buy-out house BC Partners might top a 3 billion pound ($4.56 billion) deal with CVC Capital Partners, agreed in April……

……In addition, any blow to CVC would be softened because of a $175 million break-up fee, payable if Barclays finds a new buyer.

“If they walk away, they’ll (CVC) earn a nice bit of money for a few weeks work,” one banker said, asking not to be named, because he was not involved in the sales process.

BC Partners and CVC declined to comment……


Any estimates of what iShares is worth can only have gone up given that Barclays shares have roughly doubled since it announced the deal — and almost quintupled since a trough in March — giving it bigger clout in the talks.

The “go-shop” clause, in effect until June 18, could therefore result in a fresh offer from CVC.

“Don’t underestimate CVC’s interest in iShares … they’ve got their bid in first and they do have the ability to raise the offer if they want to,” another banker said.

Any buyer picking up iShares, which offers exchange traded funds (ETF), will get access to a rare commodity with strong growth potential now that investors favor the conservative asset class.

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