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Monday, April 13, 2009

iShares ETF Sale? Not So Fast!

Barclays’ line of iShares exchange traded funds (ETFs) were sold last week to a private-equity firm. Or were they?

Under the terms of the deal struck with CVC Capital Partners, Barclays is allowed to solicit new offers for the line and “potentially other related businesses” for at least 45 days, beginning on April 15, reports Joe Morris for Ignites.

According to the Suday Telegraph, Barclays intends to do just that by sending out feelers to other fund managers. The list includes Fidelity, Vanguard, Schwab and Deutsche Bank.

The entire Barclays Global Investors unit could be on the block, some sources are saying. The unit has nearly $1.5 trillion under management. If there were any bids for BGI that included iShares, analysts say they would need to be at least $11.9 billion to gain board approval. If Barclays terminates the deal with CVC, it would have to pay a $175 million penalty.

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