Morgan Stanley to purchase Solium Capital for about US$900 million

Cornelia Mascio
Febbraio 12, 2019

US bank Morgan Stanley has signed a deal to buy Calgary-based Solium Capital Inc.in a cash deal valued at about $1.1 billion.

Shares of Morgan Stanley fell 0.7 per cent to $US40.53 in NY trading, while Solium surged 43 per cent to $US19.09.

Solium's 3000 stock plan clients, with one million participants, include Instacart, Levi Strauss, Shopify and Stripe, tapping into the firm's cloud-based service platform.

The deal will allow Morgan Stanley to attract young salaried workers, who after they sign up on Solium to manage their stock options, can eventually choose the bank's investing and virtual adviser channels, as they build their wealth, or when their investing needs arise.

The large premium Morgan Stanley agreed to pay "might raise a brow, but we think this makes significant strategic sense", analysts at Evercore ISI said in a note, adding that the link-up "provides a real path towards the organic growth and next generation of clients that many investors have been questioning".

Shares of Morgan Stanley rose 0.9 per cent to US$41.17 in early trading at 9:07 a.m. The deal announced Monday won't affect Morgan Stanley's buyback plans, and is expected to be completed in the second quarter, according to the statement.

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