Morgan Stanley to Acquire Eaton Vance for $7 Billion for ‘Strategic Transformation’

Morgan Stanley announced that it entered an agreement to buy Eaton Vance for $7 billion.

American multinational investment bank Morgan Stanley announced that it will acquire Eaton Vance Corp. The bank entered the deal to buy the wealth management company for $7 billion. Basically, the transaction will move forward Morgan Stanley’s plan for strategic transformation.

The Merger

Last week, Morgan Stanley said that it will acquire the wealth management solutions firm Eaton Vance. With this purchase, the bank can boost its investment-management portfolio. It marks as another strategy to transform Morgan Stanley into a huge global money manager, Reuters reports.

Morgan Stanley reckoned that the shareholders will find the deal attractive, as it can deliver long-term financial gains. With the merger of the two companies, the bank can “generate attractive financial returns through increased scale, improved distribution, cost savings… and revenue opportunities.”


Eaton Vance would give Morgan Stanley about $1.2 trillion in assets. Moreover, it will allow the bank to earn over $5 billion in revenue. Meanwhile, the wealth management company shareholders will own $28.25 per share in cash, with 0.5833 shares for the bank for every share they hold.

The merger will still have to undergo regulatory approval. Morgan Stanley expects the deal to complete by the second quarter of next year.

Shares for both companies rose on the morning of that day, Reuters reports. Morgan Stanley shares climbed by 1.2 percent, while Eaton Vance boosted by 47.7 percent.

‘Strategic Transformation’

In a press release, Morgan Stanley said that the acquisition will push the bank’s plans to transform with different businesses such as: Institutional Securities, Wealth Management, and Investment Management.

According to Morgan Stanley, Eaton Vance leads the market in key areas like customized investment solutions. Chief executive officer of the bank James Morgan even noted that Eaton Vance fits perfectly for the company. “This transaction further advances our strategic transformation by continuing to add more fee-based revenues to complement our world-class investment banking and institutional securities franchise,” Morgan said.

Meanwhile, Eaton Vance CEO Thomas Faust said, “Over many years, Eaton Vance has delivered above-market growth by aligning our business with leading trends in asset management.”

Phillip Malone

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