Staff windfall as US giant buys Barclays arm

Scores of Barclays staff were in line to share a £365 million windfall today after a deal was agreed to sell the bank's fund management arm.

US investment giant BlackRock announced it was buying Barclays Global Investors (BGI) for a total of 13.5 billion dollars (£8.2bn).

Around 200 Barclays employees own 4.5% of the business - valued at around 600 million dollars (£365 million) under the agreed price.

Barclays president Bob Diamond could see his personal stake valued at more than 20 million dollars (£12.2 million).

New York-based BlackRock is paying 6.6 billion dollars (£4bn) in cash and shares worth about 6.9 billion dollars (£4.2bn) for BGI.

Under the deal Barclays will end up with a near-20% stake in New York-based BlackRock.

The firm's purchase includes BGI's iShares division, which Barclays had previously agreed to sell to CVC Capital Partners for 4.4 billion dollars (£2.7bn).

CVC now has five business days to match BlackRock's terms or walk away from the deal.

Talks over the takeover of BGI came after Barclays put iShares up for sale three months ago.

IShares specialises in exchange traded funds - a type of investment vehicle which can be traded on exchanges in the same way as shares, and gives inexpensive and broad access to other kinds of investments.

In agreeing a deal with CVC, Barclays retained the right to sell the firm or related businesses to other would-be buyers under a "go-shop" clause expiring on 18 June.

BlackRock said its takeover of BGI would create a firm with combined assets under management of more than 2.7 trillion dollars (£1.64 trillion).