The deal continues the bank’s shift away from trading toward steadier, simpler businesses like money management. Eaton Vance shareholders will receive $28.25 per share in cash and 0.5833x per share in Morgan Stanley common stock, working out to around $56.50 per share. The deal would add more than $500m to Morgan Stanley Investment Management's AUM, bringing the combined total to $1.2t.
“A lot of people in January 2009 told me the premium [Morgan Stanley was paying] for [brokerage] Smith Barney was too high,” Mr. Gorman said Thursday, referring to a takeover early in his tenure that is now widely seen as a home run. Of the Eaton Vance deal, he said: “It’s fully priced, but I’m totally comfortable.”