Morgan Stanley to Spend $900 Million in Biggest Acquisition Since 2008 Crisis; Will the Trump Admin Approve?
Morgan Stanley, an investment bank involved in the midst of the 2008 financial crisis, is about to make a near-billion-dollar acquisition. |Source: REUTERS/Mike Blake/File Photo
Morgan Stanley is shelling out $0.9 billion to acquire stock-plan firm Solium Capital. The acquisition of the firm that mainly specializes in offering Software-as-a-Service for managing employee share plans, ‘financial reporting and compliance’ is expected to bolster Morgan Stanley’s wealth management business. This is the biggest acquisition that the bank has made in the last decade.
— Solium (@Solium) February 11, 2019
Solium boasts of 3,000 stock plan clients, nearly 10 times more compared to Morgan Stanley. Some of Solium’s clients include tech startups such as Stripe and Shopify.
Morgan Stanley is Banking on Young Clientele for its Future
With the tech sector employing younger workers on average compared to other industries, Morgan Stanley is hoping the acquisition will help it reach a younger demographic, according to the firm’s CEO, James Gorman:
The acquisition provides Morgan Stanley with broader access to corporate clients and a direct channel to their employees, as well as a greater opportunity to establish and develop relationships with a younger demographic and service this population early in their wealth accumulation years.
Per the Wall Street Journal, Morgan’s existing stock-plan business has been focusing on senior executives as opposed to the rank-and-file. With the acquisition, the bank will be able to serve younger employees at startups who avoid traditional financial firms.