A 221-year-old U.K. firm to fall into American hands as Nuveen to buy Schroders for $14 billion

By Jamie Chisholm

The esteemed City of London finance will maintain its brand name

Schroders agreed to be bought by Nuveen in a $14 billion deal.

A venerable City of London institution is being snapped up by a U.S. asset manager in a nearly $14 billion deal that comes amid growing fears that AI will severely disrupt the finance sector.

Chicago-based Nuveen said Thursday it had agreed to buy the U.K's Schroders (UK:SDR), a 221-year-old London-headquartered asset manager for up to 612 pence per share, valuing the company at approximately GBP9.9 billion ($13.6 billion).

Schroders shares shot up 29% to 590 pence in early trade.

The shares had dropped more than 2% on Wednesday with investors concerned that improvements in artificial intelligence may disintermediate the financial sector.

Nuveen, which is part of the Teachers Insurance and Annuity Association of America (TIAA) after it was bought in 2014, said it will keep the Schroders brand and London will serve as the combined group's non-U.S. headquarters and largest office, with around 3,100 employees.

The combined group will have nearly $2.5 trillion in assets under management, according to a filing by Schroders, making it one of the world's biggest asset managers. BlackRock (BLK), the biggest asset manager, said it had AUM of $14 trillion at the end of last year.

"This transaction is about unlocking new growth opportunities for wealth and institutional investors around the world by giving our leading, differentiated public-to-private platform a broader global presence," said William Huffman, Nuveen CEO.

The combined firm will have 17% of its assets in private markets, a fast-growing field where BlackRock also has been expanding. Private markets also have been caught up in AI disruption as many of the funds that invest in private debt have purchased the securities of software companies.

"The deal...unites distribution strengths - Nuveen's scaled U.S. wealth channel and TIAA's retirement businesses with Schroders' U.K./European and Asian platform strength - enabling a more globally diversified asset and wealth-management proposition," said a team of equity analysts at Jefferies led by Laura Gris Trillo.

"We think this deal is likely to proceed, and we see the potential for a counterbid as low. Put in context, we think this represents an attractive implied takeout valuation for Schroders' shareholders; of scaled global peers, only BlackRock trades at a premium," the Jefferies team added.

-Jamie Chisholm

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02-12-26 0712ET