REUTERS: Morgan Stanley will receive a US$375 million breakup fee if E*Trade Financial Corp walks away from its US$13 billion deal for the discount brokerage, the U.S. bank said on Friday.
On Thursday, Morgan Stanley entered into a deal to buy E*Trade, the biggest acquisition by a major Wall Street bank since the 2007-2009 financial crisis.
E*Trade has been the subject of M&A speculation for some time, especially after Charles Schwab Corp said it would buy TD Ameritrade Holding Corp last year.
If Morgan Stanley terminates the deal due to antitrust issues, E*Trade would receive US$525 million, Morgan Stanley said in a regulatory filing https://www.sec.gov/ix?doc=/Archives/edgar/data/895421/000095010320003111/dp121716_8k.htm.
The bank expects to complete the deal by the fourth quarter, and executives expressed confidence that it would meet regulatory approvals.
(Reporting by Abhishek Manikandan in Bengaluru; Editing by Shailesh Kuber)