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| Blackrock in £8.2bn Barclays deal | Blackrock in £8.2bn Barclays deal |
| (about 1 hour later) | |
| Barclays has agreed to sell its fund management division, Barclays Global Investors (BGI), to US money management firm Blackrock for £8.2bn ($13.5bn). | |
| Blackrock is paying a mixture of cash and shares in a deal that will create the world's biggest asset manager. | Blackrock is paying a mixture of cash and shares in a deal that will create the world's biggest asset manager. |
| The Barclays staff, who own 4.5% of BGI, will share a £365m windfall. Chief executive Bob Diamond will get £16m. | The Barclays staff, who own 4.5% of BGI, will share a £365m windfall. Chief executive Bob Diamond will get £16m. |
| Barclays has shunned government help, choosing to raise money privately, to help it weather the financial crisis. | Barclays has shunned government help, choosing to raise money privately, to help it weather the financial crisis. |
| If BlackRock does well, Barclays will benefit Robert PestonBBC business editor Read Robert's blog | If BlackRock does well, Barclays will benefit Robert PestonBBC business editor Read Robert's blog |
| The sale had been made to raise funds to protect against further losses on loans in investments it had made, according to BBC business editor Robert Peston. | The sale had been made to raise funds to protect against further losses on loans in investments it had made, according to BBC business editor Robert Peston. |
| He added that the sale would provide a bit more insulation from what other financial storms may lie ahead. | He added that the sale would provide a bit more insulation from what other financial storms may lie ahead. |
| Bidding war? | Bidding war? |
| BlackRock said its takeover of BGI would create a firm with combined assets under management of more than £1.64tn. | BlackRock said its takeover of BGI would create a firm with combined assets under management of more than £1.64tn. |
| The mix of cash and shares means that Barclays will emerge with 19.9% of the enlarged business. | The mix of cash and shares means that Barclays will emerge with 19.9% of the enlarged business. |
| It means Barclays will have to scrap the earlier deal under which it sold a crucial part of BGI's business, iShares, to CVC Capital Partners for $4.4bn (£2.7bn). | It means Barclays will have to scrap the earlier deal under which it sold a crucial part of BGI's business, iShares, to CVC Capital Partners for $4.4bn (£2.7bn). |
| Under the agreement, it was allowed to scrap the deal if it received a better offer before 18 June. | Under the agreement, it was allowed to scrap the deal if it received a better offer before 18 June. |
| It will now have to pay a $175m break fee to CVC - unless CVC decides to come in with a better offer for the whole of BGI and create a bidding war. | It will now have to pay a $175m break fee to CVC - unless CVC decides to come in with a better offer for the whole of BGI and create a bidding war. |
| Ishares is a unit of BGI that specializes in exchange-traded funds, which are investment funds that are listed on a stock exchange. | Ishares is a unit of BGI that specializes in exchange-traded funds, which are investment funds that are listed on a stock exchange. |