Exchange-traded fund management giant Barclays Global Investors may be spun off or sold to management, according to a report in the Money Management Letter.

The MML reports that BGI is trying to swing a management buyout, but that it will be hard to raise the US$1 billion which it expects to need to finance the deal. “BGI no longer really fits with the overall business model of its parent, Barclays plc, as well as it once did,” one banker told the newsletter, saying that Barclays is focusing on investment banking in Europe and the U.S. Neither BGI nor Barclays plc commented on the report.

Investment bankers told the MML that BGI has been in the market looking at possible pricing for a spin off, although it would prefer a management buyout.

BGI is the world’s largest institutional money manager, with US$769 billion in assets under management, primarily in index products. It manages about $39 billion in Canada, including the popular iUnits ETFs.