Microsoft is to take a 4% equity stake in London Stock Exchange Group as part of a 10-year commercial deal to migrate the exchange operator’s data platform into the cloud.
Microsoft will buy the shares from the Blackstone / Thomson Reuters Consortium.
Under the terms, LSEG has made a contractual commitment for minimum cloud-related spend with Microsoft of $2.8 billion over the term of the partnership.
This includes provision of data analytics and cloud infrastructure products using its Azure, AI and Teams platforms.
“With the Microsoft Cloud and its AI capabilities, the deal significantly advances LSEG’s strategy of building an efficient and scalable platform for its data and analytics business to deliver next-generation services . . . through improved workflow and greater flexibility,” according to a joint statement.
The stock exchange said the tech moves were “expected to increase LSEG’s revenue growth meaningfully over time as new products come on-stream”.
“This strategic partnership is a significant milestone on LSEG’s journey towards becoming the leading global financial markets infrastructure and data business, and will transform the experience for our customers,” said David Schwimmer, CEO of LSEG.
He added, “Bringing together our leading data sets, analytics, and global customer base with Microsoft’s comprehensive and trusted cloud services and global reach creates attractive revenue growth opportunities for both companies.
Microsoft said the basis of the partnership will be the digital transformation of LSEG’s technology infrastructure and Refinitiv platforms on to the Microsoft Cloud.
It added, “The initial focus will be on delivering interoperability between LSEG Workspace and Microsoft Teams, Excel and PowerPoint with other Microsoft applications and a new version of LSEG’s Workspace.”
Satya Nadella, chairman and CEO, Microsoft, said: “Advances in the cloud and AI will fundamentally transform how financial institutions research, interact, and transact across asset classes, and adapt to changing market conditions.
He said the aim is to “to build next-generation services that will empower our customers to generate business insights, automate complex and time-consuming processes, and ultimately, do more with less.”
