WisdomTree Buys ETF Securities Euro Biz

November 13, 2017

WisdomTree Investments announced Monday morning that it had reached an agreement to acquire a large portion of the European business of ETF Securities—its commodity, currency and long/short exchange-traded products. The deal will garner ETFS roughly $611 million in cash and stock consideration in shares of WisdomTree.

Those ETFS products represent nearly $18 billion in assets under management invested in 307 individual investment vehicles. When the deal is completed, WisdomTree notes in a press release that it will have roughly $66 billion in assets. It already has an extensive ETF offering in Europe, with more than $1 billion in assets under management. WisdomTree’s U.S. funds represent almost $47 billion.

“The acquisition will immediately add scale, diversification and profitability to our business in Europe, the second-largest ETF market in the world, and a growing and strategically important region for us and the entire industry,” said WisdomTree CEO and President Jonathan Steinberg of the deal.

Diversified Provider

“The addition of this complementary and competitively positioned commodity business is an important development in WisdomTree’s strategy to establish itself as a differentiated and diversified ETP provider that can thrive globally and generate long-term shareholder value,” he added.

ETFS will retain ownership of what it defines as its “ETF platform”—basically its equity and fixed-income ETFs offering.

The press release points out that the deal will push WisdomTree into the No. 9 spot among the world’s exchange-traded product sponsors.

The ETFS acquisition is also not WisdomTree’s first in the European space. In January 2014, the firm acquired a majority stake in London-based leveraged ETF issuer Boost.

The deal with ETFS is expected to close in the first quarter of 2018, the press release notes.

WisdomTree says it expects the deal to be immediately accretive to the firm’s earnings per share.

Contact Heather Bell at [email protected]

 

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