Chapter 668 BGI
In fact, not only for Britain, but also for the current EU, the best strategy is to get close to the United States politically, cooperate with China economically, and trade with Russia in energy.
Only with this strategy can it maintain its relative independence and not become a vassal of one party.
Of course, this is only the most ideal state. Obviously, this is not what the United States expects - the United States' expectation is to cut off Europe's economic exchanges with China and pit Europe against Russia, thus making It has always been a vassal of the United States, and... a blood pack.
What Barron is trying to do now is to try his best to safeguard the interests of Britain in this process.
After all, he doesn't think that even if he is a reborn person, he can stop this process with his power.
Britain is no longer the empire on which the sun never sets...
After meeting with Finance Minister Darling, Barron went to meet Davis from Standard Chartered-Merrill Lynch Group - —He has recently been in frequent contact with Robert Diamond, chairman of Barclays Bank.
What they are talking about is not LIBOR, but the acquisition of BGI, a subsidiary of Barclays Group.
Barclays Global Investors (BGI) is the asset management arm of Barclays Bank and currently manages approximately US$1.04 trillion in assets.
As early as late last month, news broke that Barclays Bank intends to sell BGI...
The reason for this is naturally that the management of Barclays Bank wants to meet the requirements of the British government. The Bank of England's capital adequacy ratio meets the requirement of 8%.
Although Barclays Bank had financed and sold their Barclays Africa Group and other businesses before this, the funds obtained, after being filled, still did not meet this requirement. …
One of the main reasons is that last year, Barclays bought Lehman Brothers’ equity and corporate finance business for US$1.75 billion, making it one of the world’s top five investment banks—but its book assets It has also rapidly increased to 2 trillion pounds, requiring more capital.
The Financial Services Authority believes that Barclays Bank has overvalued its financial assets and requires it to increase capital and reduce the ratio of capital to bonds.
Although the British government is very willing to provide funds for Barclays Bank, Barclays Bank, or to put it bluntly, the management of Barclays Bank can be said to be avoiding it - because the British government rescued Barclays Bank Finally, bank executive compensation will inevitably be restricted.
Therefore, Barclays Bank has been raising the funds it needs through financing and selling its own assets. According to estimates by relevant agencies, the sale of BGI will bring more than US$10 billion to Barclays Bank. , after obtaining these funds, Barclays Bank's Tier 1 core capital adequacy ratio will exceed 8%, thus meeting the requirements of the British government.
As for the acquisition of Barclays Global Investors (BGI), what Standard Chartered-Merrill Lynch values is that BGI owns iShares, a high-quality brand in the ETF business.
ETF began as a public fund product developed for small and medium-sized investors, tracking index investments on stock exchanges. Its advantages are low fees and providing liquidity.
At present, in addition to Standard Chartered-Merrill Lynch, those interested in BGI, a subsidiary of Barclays, include CVC Capital, Blackstone Fund and BlackRock Group.
Barron knew that in his previous life, it was BlackRock who ultimately "took the risk" to acquire BGI, which was also a rare success story in the history of world acquisitions.
Yes, in the original time and space, BlackRock Group's acquisition of BGI, a subsidiary of Barclays Bank, was a very risky move, because at that time, this acquisition could be said to have used all the funds that Larry Fink could raise. It should be noted that at this time, the operation of ETFs violates the Securities Exchange Act of the United States!
Therefore, each ETF requires an exemption from the Securities and Exchange Commission before it can start raising and operating. If the SEC no longer issues exemptions and withdraws those that have been issued, the ETF will be in catastrophe, and BlackRock will be in trouble.
But after BlackRock acquired BGI, the Fed’s quantitative easing policy became popular, and ETFs took advantage of this “east wind” to ride the trend.
Since then, global ETF assets have continued to rise, from US$1 trillion in 2009 to US$5.4 trillion ten years later.
Under this general trend, BlackRock Group's ETF business has also been on the rise - in 2009, when BlackRock Group acquired BGI, iShares assets were US$300 billion. Ten years later, the assets of iShares increased to nearly US$300 billion. $2 trillion.
It can be said that if it were not for the Federal Reserve's continued quantitative easing policy and the provision of cheap money, ETFs would never have been able to achieve such rapid development.
Cheap funds provide a large amount of spare money that can be used to invest in the stock market, driving up the stock price.
With less volatility in the stock market, there is a lack of short-selling and long-selling opportunities, and ETFs have market makers, which provide continuous arbitrage opportunities.
Now that we can see this, Standard Chartered-Merrill Lynch Group naturally has a plan to enter the ETF market in a big way. This time, through the acquisition of BGI, it will be enough to expand the business of its investment department again, and it will also be able to restrain Bei to some extent. The development of Ryder Group.
Although DS Group also holds shares in BlackRock Group, after all, it only accounts for a small amount, which is far less exciting than DS Group’s “son” Standard Chartered-Merrill Lynch Group to obtain these interests.
So Standard Chartered-Merrill Lynch proposed to Barclays Bank to acquire Barclays Global Investors (BGI) for US$10 billion in cash and US$3.5 billion worth of stocks, for a total value of US$13.5 billion. ) plan.
This price can be said to be the highest among the companies currently participating in the bid for BGI. At least judging from the attitude of Barclays Bank management, they are still very positive about this plan.
“Among the current institutions, CVC Capital is only willing to buy BGI’s ETF fund iShare, while Blackstone Fund and BlackRock Group have a more positive attitude, but in In terms of bidding, they are still behind us, and they can only come up with less than 5 billion US dollars in cash, and the remaining part needs to be acquired in the form of stocks..."
Davis told Barron’s:
“But it’s clear that Barclays needs cash more, so in that regard, BlackRock is far less competitive than us.”< br>
Barron is also aware of this matter, because just last week, Larry Finn, chairman of BlackRock Group Fink once called him, hoping to obtain part of the funds from Barron's by issuing corporate bonds...
It is impossible for Larry Fink not to know that Barron's is the Standard Chartered-Merrill Lynch Group The majority shareholder, but in this case, he opened his mouth to Barron, which also shows that he did not miss any possible opportunity to raise funds.
Of course, the result was not unexpected. Barron declined Larry Fink’s proposal.
To be honest, if he was planning to raise funds by issuing additional shares to Barron's, maybe he would consider it...
(End of Chapter)
< br>