Microsoft announces 10-year deal with London Stock Exchange; buys stake
Tech giant Microsoft has announced a 10-year strategic partnership with the London Stock Exchange Group (LSEG). As part of the deal, the company takes an approximately 4% equity stake in the bourse operator. The main purpose of the deal is to transform LSEG's digital infrastructure and migrate its data platform into the cloud. LSEG's shares are up 4% in early trade.
Why does this story matter?
Financial institutions around the world are scrambling to provide the best solutions to investors and analysts to go through the huge amount of data to find great investment opportunities. LSEG acquired Refinitiv, a data and analytics giant, in 2021 to fuel its progress in the data and analytics field. The partnership with Microsoft is the next big step in that direction.
LSEG's data infrastructure will be shifted to Microsoft Azure
The strategic collaboration between LSEG and Microsoft is to architect a new data infrastructure for the former using Microsoft Cloud. The former's data platform will be shifted to Azure, which is Microsoft's biggest public cloud platform. As part of the deal, LSEG will spend a minimum of $2.8 billion on cloud-related products with Microsoft over the term of the partnership.
Deal involves integrating LSEG's Workspace and Microsoft Teams
The partnership with Microsoft is expected to enhance LSEG's data and analytics business. Workspace, LSEG's next-generation data and analytics platform, will be integrated with Microsoft Teams and Office 365. Initially, the focus will be on building interoperability between WorkSpace and Microsoft Teams, Excel, and PowerPoint. The two also plan to develop a new version of Workspace, accessed entirely within the Microsoft 365 suite.
Microsoft will take a seat on LSEG's board
The strategic partnership between LSEG and Microsoft includes the US tech giant becoming a shareholder in the exchange operator. The company will buy a nearly 4% stake from a consortium of Blackstone and Thomson Reuters. It will also take a seat on LSEG's board. Scott Guthrie, Microsoft's vice president for the cloud and AI group, will be appointed as a non-executive director of LSEG.
The partnership is a significant milestone for LSEG: CEO
"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, LSEG's CEO. "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," claimed Satya Nadella, Microsoft's CEO.
