Morgan Stanley buys E-Trade for more than 12,000 million in shares
The entity agreed to purchase E-Trade and expects the transaction to culminate in the fourth quarter of this year
The US bank Morgan Stanley has reached an agreement to acquire the E-Trade financial services platform for 13,000 million dollars (12,034 million euros) in shares, as reported by the entities, which expect to complete the transaction in the fourth quarter of 2020.
According to the agreed conditions, Morgan Stanley will deliver 1.0432 own shares for each E-Trade title, which represents a valuation of $ 58.74, according to the quotation of the shares of the entity in yesterday’s session and assumes a premium of 30.7%.
With the purchase of E-Trade, Morgan Stanley acquires 5.2 million clients of the platform with assets worth 360,000 million dollars (332,965 million euros).
Morgan Stanley estimates that the acquisition of E-Trade could report synergies of costs of about 400 million dollars (370 million euros) by maximizing the efficiency of the technological infrastructure, in addition to potential financing synergies of about 150 million dollars (139 million euros) through the optimization of about 56,000 million dollars (51,774 million euros) in E-Trade deposits.
“E-Trade represents an extraordinary growth opportunity for our wealth management business and a leap forward in our strategy,” said James Gorman, president and CEO of Morgan Stanley.
“By joining Morgan Stanley, we can take our combined offer to the next level and bring an even more complete set of wealth management capabilities,” said Mike Pizzi, CEO of E-Trade.