Invesco closes in on ETF-business acquisition

The transaction will cost more than US$1 billion, sources say

Invesco closes in on ETF-business acquisition
The world’s fourth-largest ETF provider is close to sealing a previously announced deal to buy a promising ETF business.

According to sources familiar with the matter, Invesco is close to acquiring Guggenheim Partners’ ETF business for more than US$1 billion, reported the Wall Street Journal. The ETF business has US$36 billion in AUM.

The proposed terms would reportedly have the ETF business exchanged for cash, part of which would be paid when certain performance goals are reached.

Once finalized, the deal would help Invesco extend its reach into an increasingly popular part of the money-management industry. Investors have been discovering that ETFs, which generally cost less than mutual funds, are able to deliver the same or better returns.

The firm has been aggressively building out its passive fund offerings. Its pursuit of Guggenheim’s ETF business comes on the heels of its purchase of European ETF manager source, which manages assets amounting to US$858.3 billion.

Previous reports said Guggenheim’s whole retail business, which manages nearly US$65 billion in assets, was on the table for around US$2 billion. However, negotiations eventually zeroed in on the ETF platform, sources said.

For more of Wealth Professional's latest industry news, click here.

Related stories:
Invesco’s acquisition target could be a perfect fit
Invesco said to eye ETF-business acquisition