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Banking, finance, and taxes

Barclays, iShares, and Selling the Crown Jewels (BCS)

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By Douglas A. McIntyre Updated Published
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broken-money-merger-image6Barclays plc (NYSE: BCS) is trading higher on word that it may sell off its valuable iShares unit.  This is the golden child of the ETF industry.   The reports from the WSJ note that discussions have been held with multiple parties.  While no determination has been made yet, the figure being thrown around is 4 billion British pounds (over $5.6 billion U.S. dollars).  This may offer independent survival, but this looks like it would be no different than pawning off the Crown Jewels.

Barclay’s wants to avoid being owned or at least being controlled by the UK government via bailouts.  iShares is the most valuable ETF franchise in the world with major ETFs  that track global equities, domestic equities, specific stock sectors, real estate, fixed income, commodities, and even specialized targets.

But there is a downside here too.  This is no different than having to sell off Park Place and Boardwalk to avoid going bankrupt.  It can work, but selling off the best assets to pay for survival does not inspire confidence.

Barclays has also said that 2009 is off to a strong start.

Barclays shares are up 13% at $5.01 shortly after the open.

JON C. OGG

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About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.

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