Morgan Stanley / Eaton Vance 2021
Morgan Stanley acquired Eaton Vance for $7.0B on October 8, 2020.
- Target
- Eaton Vance
- Acquirer
- Morgan Stanley
- Deal value
- $7.0B
- Deal type
- Mixed
- Announced
- October 8, 2020
- Sub-sector
- Wealthtech
Transaction overview
- Morgan Stanley announced the acquisition of Eaton Vance on October 8, 2020 for approximately $7 billion.
- Consideration was $28.25 per share in cash plus 0.5833 Morgan Stanley shares per Eaton Vance share.
- The deal closed on March 1, 2021 following regulatory and shareholder approvals.
- Eaton Vance is a Boston-based asset manager with roots in fixed income, tax-managed equity, and responsible investing.
- Eaton Vance managed approximately $500 billion in assets at the time of announcement.
- Morgan Stanley is a New York-based global investment bank and wealth manager with over $4 trillion in client assets.
- The acquisition added Parametric Portfolio Associates and Calvert Research and Management to Morgan Stanley's investment management arm.
- Morgan Stanley targeted Eaton Vance to expand fee-based asset management revenue and reduce reliance on trading income.
Why it matters
- The deal pushed Morgan Stanley Investment Management past $1.2 trillion in AUM, making it one of the larger fee-based managers among U.S. banks.
- Parametric, Eaton Vance's direct indexing unit, was among the largest direct indexing platforms in the U.S. at close.
Strategic rationale
Morgan Stanley adds $500B AUM asset manager with Parametric direct indexing engine to build out wealth platform alongside E*TRADE.
Deal terms & multiples
About Eaton Vance
Eaton Vance was a Boston-based investment management firm founded in 1924. The firm specialized in tax-managed equity strategies, fixed income, and responsible investing through its Calvert subsidiary. Its Parametric Portfolio Associates unit offered direct indexing and custom portfolio services to institutional and high-net-worth clients. At announcement, Eaton Vance managed roughly $500 billion in assets across mutual funds, separately managed accounts, and institutional mandates.
- Founded
- 1924
- HQ
- United States
- Employees
- 1,900
- Prior funding
- Publicly traded on NYSE (ticker: EV); no private funding rounds.
- Key metric
- ~$500 billion in AUM at announcement (October 2020)
About Morgan Stanley NYSE: MS
Morgan Stanley is a New York-based investment bank and financial services firm founded in 1935. The firm operates across institutional securities, wealth management, and investment management. It reported roughly $54 billion in net revenues for full-year 2020. Prior to the Eaton Vance deal, Morgan Stanley had already acquired E*TRADE in 2020, signaling a sustained push toward fee-based and retail-facing businesses.
- Founded
- 1935
- Ticker
- NYSE: MS
Frequently asked questions
How much did Morgan Stanley pay for Eaton Vance?
Morgan Stanley paid approximately $7 billion in a mixed cash-and-stock deal, or $28.25 cash plus 0.5833 MS shares per EV share.
When did the Morgan Stanley Eaton Vance deal close?
The acquisition closed on March 1, 2021, roughly five months after the October 8, 2020 announcement.
Why did Morgan Stanley acquire Eaton Vance?
Morgan Stanley sought to grow fee-based asset management revenue and gain Parametric's direct indexing platform and Calvert's responsible investing franchise.
What happened to Parametric Portfolio Associates after the deal?
Parametric became part of Morgan Stanley Investment Management and continued operating as a distinct direct indexing and custom portfolio business.
How much AUM did Morgan Stanley Investment Management have after the deal closed?
The combined investment management unit held over $1.2 trillion in AUM following the close.
What premium did Morgan Stanley pay over Eaton Vance's pre-announcement share price?
The deal represented a premium of roughly 38% to Eaton Vance's closing share price on October 7, 2020.
Sources
- morganstanley.com /press-releases/morgan-stanley-completes-acquisition-of-eaton-vance