FTSE 100 wealth manager Schroders (SDR) has agreed a £10 billion takeover by US asset manager Nuveen. The offer represents a 34% premium to last night’s price and will create a group with $2.5 trillion of assets.

Share price: 592p (+29.5%)	PE: 18.4x
Market cap: £9.3bn	Yield: 4.7%

Strong support

Nuveen is offering 612p per share for Schroders, a 34% premium to Wednesday’s price and a 47% premium to the three-month average. The offer comprises 590p in cash and dividends of 22p to be paid before the deal takes effect.

The US firm has already received support from shareholders representing 42% of Schroders outstanding capital. That figure includes the group’s trustee companies, directors and immediate family who own shares.

The Schroders brand will be retained, as will the London office which will be the non-US headquarters of the new group. The deal is expected to complete in Q4 assuming all conditions are met and there are no rival offers.

This is big news for the UK financial services sector and suggests no firm is immune from M&A. The timing is also instructive as Schroders only raised its FY25 profit forecast a month ago.

The firm cited strong net new business, a higher-margin mix of assets, positive returns and higher performance fees. As Nuveen says, the FY25 results represent ‘significant progress’ against Schroders’ 3-year transformation programme, so it has struck while the iron is hot.

With fund outflows having largely run their course, most asset managers should report better numbers for FY26. We don’t have a favourite, but we would expect this deal to give the whole sector a lift.

Read the press release here: https://www.schroders.com/en/global/individual/investors/