(Reuters) -The London Stock Exchange Group said on Thursday it will sell a 20% stake in its clearing unit to a group of banks in a deal that values the business at 850 million pounds ($1.14 billion), and announced plans to raise its share of profits from the SwapClear business.
The group’s shares jumped 8% in early trading on Thursday after the agreements were unveiled alongside quarterly results that beat market expectations.
Post Trade Solutions supports the market for uncleared derivatives – a type of financial contract for assets – by offering risk management and efficiency tools, while SwapClear provides clearing services for interest rate swaps.
LSEG, which operates the London Stock Exchange, has been expanding its offerings to meet demand driven by AI, cloud adoption, and market volatility, to counter worries over competition which has pressured shares.
A group of 11 banks will buy the stake in the Post Trade Solutions unit for 170 million pounds, LSEG said, adding that as a result of their investment in Post Trade, the banks’ share of revenue surplus from SwapClear will be reduced to 15% from 30% this year. The banks are among the founding members of SwapClear.
For a bigger share of profits from SwapClear, LSEG will pay 1.15 billion pounds in two instalments, with the banks’ share falling to 10% from 2026, LSEG said.
LSEG on Thursday reported third-quarter income that beat market expectations and raised its margin forecasts for the year as growth in annual subscription value, which indicates recurring revenue and is closely watched by analysts, would accelerate into the end of the year.
It also said it would buy back shares worth 1 billion pounds by February 2026.
Reuters provides news for LSEG’s flagship news and data terminal Workspace.
($1 = 0.7451 pounds)
(Reporting by Pushkala Aripaka in Bengaluru; Editing by Mrigank Dhaniwala)
