Morgan Stanley is set to acquire Eaton Vance, which has over $500bn (€420.7bn) in assets under management (AUM), for an equity value of approximately $7bn.
The move is in line with Morgan Stanley’s strategic transformation into three businesses of scale: institutional securities, wealth management and investment management, the group announced yesterday.
Morgan Stanley Investment Management (MSIM) will be a leading asset manager with approximately $1.2tr of AUM and more than $5bn of combined revenues.
Morgan Stanley said MSIM and Eaton Vance are “highly complementary with limited overlap in investment and distribution capabilities”.
It said that Eaton Vance is a market leader in responsible ESG investing, in value-add fixed income solutions, and, therefore, “fills product gaps and delivers quality scale to the MSIM franchise”.
James P. Gorman, chair and chief executive officer of Morgan Stanley, said: “Eaton Vance is a perfect fit for Morgan Stanley.”
He added that the 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”.
With the addition of Eaton Vance, Morgan Stanley will oversee $4.4trn of client assets and AUM across its wealth management and investment management businesses, he said.
The acquisition is subject to customary closing conditions, and is expected to close in the second quarter of 2021.
Schroders has been appointed by Santander Asset Management (SAM) to manage six UK equities mandates worth a total of £1.2bn (€1.3bn), of which £1bn are in UK growth and £200m are in UK income assets.
Schroders will manage the Santander UK Growth Unit Trust, Santander Equity Income Unit Trust and Santander Enhanced Income Portfolio, as well as three UK equity mandates within SAM multi-asset funds, Schroders disclosed, adding that the funds will continue to be SAM branded.
The transition will involve SAM’s UK equity investors Graham Ashby and Duncan Green moving to Schroders as portfolio managers, alongside Ashley Thomas who will join as a research analyst, to continue to manage these assets, Schroders added.
Rory Bateman, Schroders’ head of equities, said: “We believe there is a strong cultural fit between the investment teams, characterised by a shared commitment to delivering excellent performance and meeting the investment needs of clients. We are excited that such talented equity investors will be joining the Schroders group and enhancing our well-established UK equities business.”
Investment Association calls for greater transparency on ethnic diversity on boards
The Investment Association (IA) is asking for greater transparency on ethnic diversity on boards as almost three-quarters of FTSE 100 companies failed to report the ethnic make-up of their boards in this year’s annual general meeting (AGM) season, according to its research*.
Investors have previously asked companies to include information on the ethnic make-up of their boards, alongside gender diversity, in their annual reports.
With FTSE 100 boards expected to have at least one director from an ethnic minority background by 2021 under the UK government-sponsored Parker Review, this lack of information is preventing investors from holding companies to account on their progress, the IA said.
IA’s members expect companies not just to state whether they meet the Parker Review targets but to disclose the percentage of the board that comes from an ethnic minority background.
Chris Cummings, chief executive officer of the of the IA, said: “FTSE 100 firms are falling far short of investors’ expectations when it comes to reporting the ethnic diversity of their boards. The Parker Review from earlier this year showed there is still significant progress to be made on improving the ethnic diversity of UK plc boards and investors need more information to assess a company’s journey to meeting the Parker Review target. Transparency is key.”
He said there has been good progress on gender diversity when companies have “held up the mirror to themselves and listened to investors’ concerns”. Companies now need to take more urgent action and report on ethnic diversity on their boards, he added.
FTSE-listed companies have, however, made good progress on increasing the number of women on their boards with the FTSE 350 now meeting the 33% gender diversity target set by the Hampton-Alexander Review in aggregate.
The IA said investment managers are keeping up the pressure on those still falling short, calling for companies that have not met the target to take action now.
* The IA based its findings on 93 FTSE 100 companies with year-ends on or after 31 December 2019 which have held their AGM as of 30 September 2020.