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Morgan Stanley To Buy Eaton Vance For $7B

By  |  October 8, 2020

Morgan Stanley announced it is buying fund manager Eaton Vance for US$7 billion just days after completing its takeover of discount broker E*Trade Financial, continuing the firm’s shift away from trading toward steadier, simpler businesses like money management. 

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    The deal would nearly double the assets that Morgan Stanley manages on behalf of pension funds, insurance companies, and other clients, to US$1.2 trillion, as well as add about US$1.7 billion of annual revenue, reported the Wall Street Journal.

    Morgan Stanley’s asset-management arm is the most profitable of the bank’s four divisions, but also its smallest, and had been seen as too niche to compete with larger rivals.

    Boston-based Eaton Vance, founded in 1924, brings about US$500 billion in assets and bulks up Morgan Stanley’s undersized presence in bonds and sustainable investing.

    Morgan Stanley Chief Executive James Gorman said Eaton Vance executives approached his firm a few months ago and found a receptive buyer, but that the bank needed to complete its takeover of E*Trade first, which happened last week.