Morgan Stanley just made its biggest deal since financial crisis

Morgan Stanley announced Monday it will buy Solium Capital, a Canadian company that prepares stock plans for start-ups, for $900 million.

The Wall Street bank said it will pay $19.15 Canadian per share for Calgary-based Solium, adding it expects the transaction to close in the second quarter.

The “goal will obviously be two-fold: 1) to run a profitable stock plan administration business and expand its distribution to the millions of MS clients, and 2) deliver MS’s world class wealth management services into existing and future Solium stock plan clients,” Evercore ISI analyst Glenn Schorr said in a note to clients. “Solium will add even more to the stability of the wealth mgmt. division as it’s a subscription model with an 11% revenue [compound annual growth rate] over the last 5 years.”

The deal is Morgan Stanley’s biggest since the financial crisis and comes three days after the largest bank merger in a decade was announced. BB&T agreed to buy SunTrust Banks for more than $28 billion in an all-stock deal.

Morgan Stanley CEO James Gorman told The Wall Street Journal he’d like to “do more” acquisitions. “Last year was the first time we felt comfortable that we could even consider” acquisitions.

Michael Bloom
contributed to this report.

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