Now that Barclays has said it is shopping its iShares exchange-traded fund business, bets are mounting as to who might be buying.
First, what is iShares really worth? A few initial reports put it somewhere around $7 billion, though that's likely a high (other analysts put it closer to $3 billion). Still, the prospect of a sale does seem to be helping Barclays stock this week. As the FT notes, Barclays shares are up a whopping 45 percent this week even as the bank suffers through reports of a huge tax-dodge scheme, and even more modest valuations for iShares put it at more than a third of the entire bank's value (and one of the easier spots to find much-needed funding).
So who's stepping up to buy? Forbes rounds up some fund and ETF experts and tosses out a few names including Northern Trust, Charles Schwab Corp., and Fidelity, plus BNY-Mellon or Deutsche Bank.
It's likely there are lots of possible buyers for one of finance's still-sterling businesses. Matt Hougan (who picks a few more possibilities at IndexUniverse.com) outlines why:
Make no mistake: iShares would be a jewel for any of them. It controls 46% of all ETF industry assets, including six of the top 10 funds. Its iShares MSCI Emerging Markets ETF (NYSE Arca: EEM) is the second-highest grossing ETF in the world, pulling in over $110 million per year; only the SPDR Gold Shares (NYSE Arca: GLD) does better, grossing $125 million. And it sits at the heart of one of the fastest-growing segments of the financial services industry.
The speed and size of growth in the iShares franchise is stunning, and a testament to a real shift among investors and advisors to an asset class that barely even existed a decade ago. That iShares could command such a heft price shows some real confidence that the ETF platform is only going to increase in stature in the years to come.
Reader Comments