Microsoft takes a stake in the operator of the London Stock Exchange

Microsoft has agreed to acquire a stake in London Stock Exchange Group Plc, giving the software company a 4 percent equity stake, a deal that underscores the key position of data, analytics and technology in increasingly computerized financial markets. Microsoft will acquire the shares as part of a new long-term strategic partnership that aims to provide cloud computing services for the exchange, LSEG said in a statement Monday. At Friday’s closing price, a 4 percent stake was valued at around £1.6 billion (€1.85 billion) in the stock market. The investment is part of a broader 10-year agreement to help the London Stock Exchange owner improve its data analytics and cloud infrastructure using Microsoft products. Scott Guthrie, Microsoft’s executive vice president of cloud and artificial intelligence, is appointed director. The agreement is the latest sign of increasing investor demand for information that will give them an advantage in accelerating electronic markets. According to an April report by Burton-Taylor International Consulting, global spending on financial markets data and news grew 7.4 percent to a record $35.6 billion in 2021. “We will see significant revenue growth in the coming years by accessing new products and enhancing our existing product capabilities,” said David Schwimmer, LSEG’s chief executive officer, in a phone interview. Microsoft will buy its stake from a consortium consisting of Blackstone, Thomson Reuters Corp. and affiliates of the Canada Pension Plan Investment Board and Singapore’s GIC, the statement said. Shares in LSEG were up 3.8 percent as of 10:01 am in London. The deal underscores LSEG’s increasing focus on data and analytics. The company completed a $27 billion purchase of Refinitiv last year, ushering in a new era in which the majority of its revenue comes from data. Bloomberg News’ parent company competes with Refinitiv for financial news, data and information. The agreement is expected to cost LSEG between £250m and £300m between 2023 and 2025, including around £100m in capital expenditure. The group said it has a contract with Microsoft to spend at least $2.8 billion on cloud-related services and support over the next 10 years. Additional spending will depend on the “success of the strategic partnership” and demand for LSEG’s data platform and professional services, according to the UK company. Microsoft estimated in a separate statement that the “partnership and broader market opportunity could bring the company $5 billion in additional revenue over the next 10 years.” Azure Platform Under the terms of the agreement, LSEG’s data platform and other key technology infrastructure will be migrated to Microsoft’s Azure cloud environment, while its data and analytics will be connected to specific Microsoft applications. In recent years, there has been a consolidation among the largest data providers in the financial industry. Last year S&P Global Inc agreed to purchase IHS Markit Ltd. while Deutsche Boerse, LSE’s biggest European rival, took a majority stake in Institutional Shareholder Services Inc., the corporate governance advisor. It’s not the first time Microsoft has struck a deal alongside unveiling a massive cloud deal. In 2018, the company invested in Grab, with the ride-hailing company agreeing to adopt Azure as its preferred cloud platform. These cross-selling offers do not always end successfully. In 2012, the US tech company invested $300 million in a stake in bookseller Barnes & Noble’s then-ailing Nook e-book division. As part of the deal, Barnes & Noble agreed to create e-reading content for Microsoft. Two years later, Barnes & Noble bought Microsoft’s stake for about $125 million after Nook struggled to attract customers. (Blumberg) Microsoft takes a stake in the operator of the London Stock Exchange

Fry Electronics Team

Fry is an automatic aggregator of the all world’s media. In each content, the hyperlink to the primary source is specified. All trademarks belong to their rightful owners, all materials to their authors. If you are the owner of the content and do not want us to publish your materials, please contact us by email – The content will be deleted within 24 hours.

Related Articles

Back to top button