London Stock Exchange buys data provider Beyond Ratings in ESG push

FILE PHOTO: Signage is seen outside the entrance of the London Stock Exchange in London, Britain. Aug 23, 2018. REUTERS/Peter Nicholls/File Photo

(Reuters) - London Stock Exchange Group Plc said on Monday it acquired data provider Beyond Ratings, as the exchange operator bulks up its Information Services business to meet a growing demand for environmental, social and governance (ESG) products.

The deal, terms of which were not disclosed, will be funded from existing facilities, the LSE said, adding that the addition was highly complementary to FTSE Russell’s existing ESG index and data offering.

Waqas Samad, Group Director of LSE’s Information Services business, told Reuters on a call that clients continued to ask for solutions for ESG and sustainability in fixed income as much as they did in equities. He added that ESG has been growing rapidly over the past five years.

“This (Beyond Ratings) is a great fit for us” Samad said.

He added that ESG principles are being applied to investment strategies across asset classes, and that within ESG, there was a lot of demand for climate impact.

The purchase of Beyond Ratings, which provides ESG data for fixed income investors, is part of LSE’s continued investment in the Information Services business.

LSE’s Information Services business, which makes up nearly half of total revenue, provides information and data products including indices and benchmarks, analytics, real time pricing data, product identification and trade reporting and reconciliation services.

Shares of the FTSE 100 company, which climbed as much as 1.2% following the deal announcement, were up 0.7% by 1158 GMT.

Reporting by Muvija M in Bengaluru; editing by Gopakumar Warrier and Shailesh Kuber