LSE to buy Pearson’s FTSE stake
The London Stock Exchange Group has signed a definitive agreement to acquire the 50 per cent stake in FTSE International Limited, from Pearson, that it does not already own. Following the transaction which is expected to close in Q1 2012 subject to customary closing conditions, FTSE International Limited will be wholly owned by the London Stock Exchange Group.
FTSE currently calculates and manages over 200,000 indices worldwide which are linked to over USD3 trillion in global Assets under Management. These include the widely used global benchmark, the FTSE All-World Index, as well as a range of flagship indices around the world, such as the FTSE 100 Index and the FTSE MIB Index. FTSE also has successful partnership indices with several stock exchanges; FTSE/JSE Top 40 Index, FTSE KLCI and the Straits Times Index, which form the basis of a range of high profile ETFs globally.
The change announced today signifies the value of FTSE’s business model, diverse client base and global benchmarking success and will facilitate the effective delivery of its business strategy, enabling it to further build on its position as a leading provider of global benchmarks.
FTSE’s ambitious growth plans will be accelerated with the support of the London Stock Exchange Group, including its expansion in geographies such as the US, where increased usage of its indices amongst some of the largest asset owners and investment managers accounts for 30% of total index revenues.
With a proven track record in index innovation, including a large range of alternatively-weighted indices and index analytics, FTSE will continue to invest in the development of robust index solutions and related data services which meet the needs of investors globally.
Along with the continuation of FTSE’s current strategy and growth plans, the London Stock Exchange Group fully supports the current polices and operations concerning the calculation, management and governance of FTSE indices. This includes FTSE’s independent index committees and presiding Policy Group, comprising market practitioners’ and industry specialists. This independent market-led approach will remain core to FTSE’s index governance practices, maintaining a vital difference between FTSE and its peers. Additionally, there will be no change to FTSE’s internal structure including its leadership, with Mark Makepeace remaining as CEO of FTSE.
Mark Makepeace, Chief Executive, FTSE, says: “FTSE has built a successful global benchmarking business, amidst an evolving industry where investor appetite for our products is fast growing. The transition announced today will be an important catalyst in FTSE’s global expansion, and the rollout of high quality index solutions to meet demand from global investors, as well as grow FTSE’s business in the ETF and derivatives space.”
Xavier Rolet, CEO, London Stock Exchange Group, says: “Fully aligning FTSE with one of the world's most liquid and most international trading groups is an exciting opportunity. This transaction further delivers on our diversification strategy, expanding the London Stock Group’s existing offering deeper into indices, derivatives and market data products and services. This is a business we know well, and we expect that going forward our customers will directly benefit from greater choice, opportunity and innovation.”
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