ETF firm WisdomTree held takeover talks with Principal Financial Group last year
- ETF manager WisdomTree held acquisition talks late last year with Iowa-based asset manager Principal Financial Group, sources tell Business Insider.
- JPMorgan also held takeover talks with WisdomTree, according to an earlier report from Bloomberg.
ETF manager WisdomTree held sale talks with asset manager Principal Financial Group late-last year, sources tell Business Insider.
It's unclear how serious the discussions were and the two parties are not currently in negotiations, the sources added.
WisdomTree also held similar talks with JPMorgan, Bloomberg reported earlier this week, but a prospective deal fell apart over price.
Representatives for WisdomTree and Principal declined to comment.
Shares of WisdomTree cratered in the last 12 months, falling 40% amid a broader sell-off among asset managers. The industry is suffering from fee pressures, outflows, and increased market volatility, which has triggered some asset managers to consider striking deals.
Other recent acquisitions in the ETF space include Invesco's $1.2 billion purchase of Guggenheim's suite of ETFs and Hartford's purchase of Lattice Strategies. The gold standard of acquisitions in the space is BlackRock's purchase of iShares for $13.5 billion in 2009. Assets in iShares have grown from $290 billion to more than $1.7 trillion in 10 years.
Principal, which has just 13 ETFs with over $3 billion in assets, is a relatively small player in the fast-growing ETF market. ETFs, or exchange-traded funds, are similar to mutual funds in that they invest a basket of stocks, bonds and other securities. The biggest difference between the two products is that ETFs trade on an exchange like stocks and are generally more liquid than mutual funds.
WisdomTree is one of the biggest ETF providers, with more than $38 billion in domestic assets. The firm has partnered with distribution platforms like TD Ameritrade to offer model portfolios made up of WisdomTree and other asset managers' ETFs.
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