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About Barra, LLC

MSCI, formerly Morgan Stanley Capital International, manages more than 145,000 daily equity, fixed income, and hedge fund indices for use by large asset management firms. MSCI is organized through four business segments. Its Analytics business provides risk management, performance attribution and portfolio management content, applications and services that provide clients with an integrated view of risk and return and an analysis of market, credit, liquidity, and counterparty risk across all major asset classes under brands such as MSCI BEON, RiskMetrics, and Barra.  MSCI has over 7,500 clients across more than 85 countries. The Americas accounts for about half of the company's total sales.

Operations

MSCI operates four operating segment: Index, Analytics, ESG and Real Estate. For reporting purposes, the ESG and Real Estate operating segments are combined and presented as All Other as they do not meet the thresholds for separate presentation.

The Index segment (about 60% of sales) is used in many areas of the investment process, including index-linked product creation, performance benchmarking, portfolio construction and rebalancing, broker-dealer structured products and asset allocation. The company currently calculates more than 226,000 end-of-day indexes daily and more than 12,000 indexes in real time for a variety of markets and industries.

The Analytics segment (over 30% of sales) offers risk management, performance attribution and portfolio management content, applications, and services that provide clients with an integrated view of risk and return and an analysis of market, credit, liquidity and counterparty risk across all major asset classes, spanning short-medium- and long-term time horizons.

The ESG and Real estate accounts for some 10% of sales. MSCI ESG Research analyzes over 8,500 entities worldwide to help institutional investors understand how ESG considerations can impact the long-term risk and reward of its portfolio and individual security-level, while the Real Estate segment includes research, reporting, market data and benchmarking offerings that provide real estate performance analytics for funds, investors and managers.

Geographic Reach

Around half of the company's revenues come from outside the Americas. MSCI has more than 30 offices in over 20 countries worldwide, including headquarters in New York and offices in Chicago, Illinois; Geneva, Switzerland; San Francisco, California; Beijing, China; Frankfurt, Germany; Shanghai, China; Hong Kong, China; Paris, France; Tokyo, Japan; Portland, Maine; Sydney, Australia; Toronto, Canada; and Singapore. As part of its global expansion efforts, in the last few years MSCI has opened international offices in Budapest, Monterrey, and Mumbai.

Sales and Marketing

Clients receive index data directly from the company or from third-party vendors worldwide, while clients access the Analytics content through its proprietary applications and APIs (application programming interfaces), third-party applications or directly through the own platforms.

MSCI served over 7,500 clients which include Asset owners, Asset managers, Financial intermediaries, and Wealth managers. The company's largest client organization, BlackRock, accounted for over 10% of the company's total sales.

The company's selling and marketing expenses were $0.22 million in 2019, $0.19 million in 2018, and $0.18 million in 2017.

Financial Performance

MSCI enjoyed revenue growth for the last five years. Revenue increased by 45% in the 2015 to 2019 period. Net income followed the growth trend for the same span.

In 2019, revenue increased by 9% to $1.6 billion. Increases of 8%, 7%, and 35% in recurring subscriptions, asset-based fees, and non-recurring subscriptions, respectively, contributed to the rise of total revenues for the year.

Net income also increased by 11% to $563.6 million due to high operating revenue and lower provision from income tax.

MSCI's cash at the end of 2019 was $1.5 billion. Net cash provided by operating activities was $709.5 million, while cash used in investing activities was $71.9 million. Financing activities used another $36.7 million. Main cash uses for the year were for repayment of long-term debt, repurchase of common stocks, and for payments of dividends.

Strategy

MSCI provides the tools and solutions that enable investors to take advantage of the transformation taking place in the investment industry, helping them better understand performance and risk, become more effective and efficient at building portfolios and achieve their investment objectives. In particular, the company is focused on delivering actionable and integrated client solutions with the following key initiatives:

Expanding leadership in research-enhanced content across asset classes by continuing to deliver solutions that incorporate multiple areas of content and are supported by rich insights from its research and product development team.

Improving distribution and content-enabling technology by investing in the development and use of advanced technology to drive integration and efficiencies, accelerate innovation and enhance the client experience. In addition, it is increasingly employing proprietary and third-party machine learning and artificial intelligence to enhance its ability to gather and analyze data and automate and enhance the efficiency of many of its data processes.

Strengthening existing client relationships and growing by developing new ones by growing its existing offerings by cultivating and expanding relationships across its client base and serving the needs of different client types across multiple asset classes.

Executing strategic relationships and acquisitions with complementary content and technology companies by evaluating and selectively pursuing strategic relationships with, and acquisitions of, providers of unique and differentiated content, products and technologies that it believes has the potential to complement, enhance or expand its offerings and client base.

Mergers and Acquisitions

MSCI Inc.'s subsidiary, MSCI Barra (Suisse) Sàrl, has completed its acquisition of Zurich-based environmental fintech and data analytics firm specializing in climate change scenario analysis, Carbon Delta AG. The business is expected to add approximately $4 to $5 million of recurring expenses to the ESG operating segment within MSCI's "All Other" reporting segment. Terms of the transaction were not disclosed.

Barra, LLC

2100 Milvia St
Berkeley, CA 94704-1861
Phone: 1 (510) 548-5442

Firm Stats

Employer Type: Privately Owned
Sales Representative: Sapna Arvind
Office Coordinator: Angela Battle
Vice President: Sue Gledhill
Employees (This Location): 280
Employees (All Locations): 554

Major Office Locations

Berkeley, CA

Other Locations

New York, NY