Nine investment banks have agreed to buy a minority stake in Thomson Corp's bond trading platform TradeWeb for about $180 million in a bid to expand the service after most of them sold out of it in 2004.
The banks include Merrill Lynch, Goldman Sachs, JPMorgan Chase, Credit Suisse, Lehman Brothers, Morgan Stanley, Deutsche Bank, Royal Bank of Scotland and UBS Investment Bank.
Seven of the nine were the previous owners of TradeWeb who sold the business to Thomson in April 2004. Citigroup Inc. also had been part of the previous ownership group. UBS and RBS were not. TradeWeb, which Thomson bought for $385 million cash and up to $150 million in payments based on performance, is a marketplace for dealers in fixed income and derivatives with about 2,200 buyside customers.
Thomson said all the banks have committed to participate in TradeWeb's markets, including in interest rate swaps. Thomson and the banks will also fund additional investment in expanding TradeWeb in various asset classes, it said.
The size of the minority stake the banks are buying was not disclosed. The Wall Street Journal reported that the deal would value TradeWeb at about $1.5 billion, without citing the source. TradeWeb clients executed more than $51.2 trillion in trades last year, nearly double the amount from 2004. It said average daily trading volume exceeds $250 billion.