In a deal that reshuffles the mutual fund space, TIAA-CREF said Monday it had agreed to acquire Nuveen Investments Inc. for $6.25 billion from a group led by private-equity firm Madison Dearborn Partners.
The deal is the largest transaction in the asset management business since 2006 and is a major coup for TIAA-CREF, an asset manager with $569 billion under management and roots as a major retirement servicer for nonprofit organizations such as universities and hospitals.
The acquisition deepens TIAA-CREF's investment expertise and distribution capabilities in the adviser-sold market for mutual funds, given Nuveen's deep relationships with broker-dealers and financial planners, according to industry consultant Geoffrey H. Bobroff.
“It's a significant step for TIAA-CREF, which has not been known to be an acquirer,” said Mr. Bobroff. “It is a distribution play.”
Nuveen, which has its roots in municipal bonds, brings some $221 billion in assets and an entrenched brand in mutual funds. Through the years, the company has acquired boutiques and worked to expand its expertise in areas such as equities and commodities. The business includes one of the largest sponsors of closed-end funds, as well as $54 billion in open-end mutual funds and offerings in separately managed accounts.
Madison Dearborn was the lead buyer in the $5.75 billion deal in 2007.
What TIAA-CREF's acquisition of Nuveen means for financial advisers
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