By Mike Stone
NEW YORK, July 11 (Reuters) - Barclays Plc's planned sale of its index business could yield close to $1billion for the British bank, more than double what had beenexpected, according to people familiar with the matter.
The long-anticipated sale of the Index, Portfolio and RiskSolutions (IPRS) business kicked off in early June, and severalbidders recently progressed into the auction's second round, thepeople reported.
Before Barclays provided detailed financial information onthe index business, potential bidders had estimated the unit tobe worth above $400 million, the people said. The businessincludes a basket of over 98 major indexes, according to theunit's website.
But the business showed much higher than expected revenuefigures during early due diligence, and now potential buyers arevaluing the unit at nearly $1 billion, the people said, askingnot to be named because the matter is not public.
The estimated price tag reflects a multiple of over eighttimes revenues, which is in line with precedent transactions forindex businesses, the people said.
A Barclays representative declined to comment.
The U.S. Aggregate Bond Index, which Barclays bought as partof the Lehman Brothers acquisition during the financial crisis,is among the platform's best-known offerings.
In addition, the Barclays business includes a risk solutionssoftware tool used by institutional investors to performanalysis of their holdings.
Indexes such as MSCI Inc, London Stock ExchangeGroup Plc, McGraw Hill Financial's Standard &Poor's index unit, as well as financial information servicesMarkit Ltd and Bloomberg LP could be contenders, one ofthe people said. It was unknown who still remained in theprocess.
Barclays also had attracted preliminary interest fromInteractive Data Corp and Thomson Reuters Corp.
Reuters first reported in November that Barclays beganexploring options for the index business following an approachfrom MSCI.
Northwestern Mutual Life Insurance Company recently sold its index business, Russell Investments,to the London Stock Exchange Group Plc for $2.7 billion. (Reporting by Mike Stone; Editing by Leslie Adler)
Barclays (BARC)