Barclays iShares sale in doubt as more bids come in

11 May 2009 / by Rachael Stiles
Barclays has received new interest for the purchase of iShares, part of its fund management business, casting its existing deal into doubt, reports have said.

Last month, Barclays Global Investors agreed to sell iShares to private equity firm CVC for £3billion, but the agreement includes a 'go-shop' clause which entitles Barclays to accept a better offer within 45 days.

Now BC Partners, an international buyout firm, has shown an interest in iShares, allegedly lodging an estimated £3.5billion bid, the Sunday Times has reported.

CVC has the right to match any better offer than Barclays receives as part of the clause, but if it declines Barclays will have to pay the firm £175million.

Barclays has been seeking a buyer for its iShares business since earlier this year, in an attempt to boost capital reserves and avoid turning to the Government for a cash injection, as some of its rivals have done.

A Barclays spokesman said there had been "tremendous" interest in iShares from "both strategic and private equity" since the sale with CVC and the 'go-shop' clause was announced, Reuters reports.

But, the spokesman said, it was "too early to speculate if there will be a better offer and from whom."

Several other reports have named further bidders for iShares which have emerged over the weekend, including other buyout firms Apax and Hellman & Friedman. There is also the possibility of bids from previous suitors for iShares, such as Goldman Sachs, which showed an interest before CVC was named as the preferred bidder.

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