Microsoft (NASDAQ: MSFT) will pick up a 4% stake in the London Stock Exchange (UK: LSEG) as part of a 10-year commercial deal. This deal will result in MSFT migrating the stock exchange’s data platform into the cloud.
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As part of this deal, LSEG will have a cloud-related spend of a minimum of $2.8 billion over the term of the partnership.
Microsoft stated that this partnership will result in the digital transformation of LSEG’s technology infrastructure and Refinitiv platforms.
Microsoft pointed out that 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.”
However, according to a Reuters report, the reliance of financial services providers’ on a handful of companies including Microsoft and Google (GOOGL) is also inviting more regulatory scrutiny.
This is because regulators have been concerned that a glitch at one of these handfuls of cloud companies could bring down services at many of these firms.
Analysts are upbeat about MSFT stock with a Strong Buy consensus rating based on 25 Buys and three Holds.