Morgan Stanley to acquire E*Trade in all stock deal

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Morgan Stanley (NYSE: MS) confirmed today that it is acquiring E*Trade Financial Corp. (NASDAQ: ETFC) in a $13 billion all-stock deal.

They announced that they will pay 1.0432 of its shares for each E*Trade share, equal to $58.74 based on its closing price Feb. 19, 2020.

Morgan Stanley Statement: ”The deal will significantly increase the scale and breadth of Morgan Stanley’s Wealth Management franchise. This will position Morgan Stanley to be an industry leader in Wealth Management across all channels and wealth segments”

E*Trade (ETFC) has more than 5.2 million client accounts worldwide. The company manages over $360 billion of retail client assets, adding to Morgan’s existing 3 million client relationships and $2.7 trillion of client assets. 

The merger came after U.S. brokers Charles Schwab and TD Ameritrade (NASDAQ: AMTD), announced a transition towards commission-free stock trading. Brokerages were having a very difficult time competing with commission-free stock trading platforms like Robinhood and Webull.

”Wealth and investment-management businesses are expected to account for about 57% of pretax profits after the acquisition, versus 26% in 2010”, the company said in a statement.

For more information,

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