Microsoft is acquiring a 4% stake in the London Stock Exchange Group (LSEG)as part of a 10-year deal in which London Stock Exchange will spend at least $2.8 billion on Microsoft’s cloud services.
The stock purchase comes at a time when London is struggling to retain its position as Europe’s financial center. According to Bloomberg data, the UK capital accounted for $1.8 billion (£1.46 billion) of the $20.9 billion raised in European listings this year. It is the lowest share since the 2007-08 financial crisis, accounting for only 9% of the total.
Microsoft will buy the stake from a consortium led by Blackstone and Thomson Reuters, and will join LSEG board of directors. Previously, the consortium sold the financial data company Refinitiv to LSEG for £22 billion.
According to the LSEG, the partnership includes next-generation data and analytics, as well as cloud computing products. It includes a new data infrastructure for the London stock exchange, as well as analytics and modeling solutions powered by Microsoft Azure, AI, and Microsoft Teams.
LSEG stated that the deal would result in a significant increase in revenues after 2025 from selling more of its existing products through Microsoft apps to broaden the customer base, as well as better product pricing, but it declined to provide specific estimates.
Although, trade regulators are not happy with the deal going through, and have raised objections.
The sources for this piece include an article in Reuters.