Smart beta

29 September 2017 By Tom Buerkle

The Wall Street firm has snagged a hefty 12 times EBITDA from Invesco for its ETF unit. The buyer also bags a big tax break, but barely gains ground on industry giants. Guggenheim, meanwhile, pockets a welcome $1.2 bln distraction from months of debilitating executive squabbling.

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Invesco on Sept. 28 said it has agreed to acquire the exchange-traded funds business of Guggenheim Investments for $1.2 billion in cash. The unit manages 77 ETFs with a total of $36.7 billion of assets. It also has annual revenue of $108 million. The deal will boost Invesco’s ETF assets to about $196 billion.

The acquisition “will enable us to provide one of the industry’s most comprehensive and innovative ranges of smart beta ETFs, including fixed income, equal-weight and self-indexed product offerings,” Invesco CEO Martin Flanagan said.

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