- Executes on regional investment advisor strategy by adding one
of the country's largest independent investment advisory firms
using mutual funds
- Adds a scalable business platform that will manage additional
client assets with minimal incremental expense
- Transaction expected to be accretive in 2006
NEW YORK, Aug. 9 /PRNewswire-FirstCall/ -- E*TRADE FINANCIAL Corporation
(NYSE: ET) today announced its plans to acquire Massachusetts-based Kobren
Insight Management, a registered investment advisor that manages approximately
$1 billion for private clients and serves as the investment advisor to the
Kobren Insight Funds from the Kobren Insight Group. The acquisition advances
E*TRADE FINANCIAL's regional advisor strategy, offering personalized wealth
management services to its retail and Corporate Services clients with over
$250,000 in assets.
The Kobren acquisition, the latest in a series of consolidation
initiatives at E*TRADE FINANCIAL and within the industry, strengthens
E*TRADE's influence among retail investors with sizable assets. E*TRADE
expects the deal to contribute close to $10 million in revenues and $2.3
million in net income in FY 2006.
Today's announcement, coupled with yesterday's announced acquisition of
HARRISdirect and the January 2005 acquisition of Howard Capital Management,
signals E*TRADE FINANCIAL's expansion from a trading-focused organization to a
fully-integrated financial services firm that has the unique opportunity to
monetize all aspects of the customer relationship among its retail and
institutional business segments.
"E*TRADE FINANCIAL seeks to enhance its advice and wealth management
services by creating high-value tools and services targeted to each of our
retail customer segments," said R. Jarrett Lilien, President and COO, E*TRADE
FINANCIAL. "The acquisition of Kobren Insight Management will bring customer
relationships that can be monetized through our cash, investment and credit
solutions."
The deal with Kobren Insight Management is expected to close in Q4 2005,
following customary closing conditions. E*TRADE will continue to look toward
acquiring established wealth management firms in the key customer markets of
New York City, Philadelphia, Greater Washington DC, Atlanta, Orlando, Chicago,
Dallas, Denver, Scottsdale, San Diego, Orange County, Silicon Valley and San
Francisco.
As a subsidiary of E*TRADE FINANCIAL, Kobren Asset Management will
continue to operate under the Kobren name, retaining both its personnel and
location. The acquisition will bring two recognized wealth management
influencers to the E*TRADE FINANCIAL team, Eric Kobren, President and CIO, and
Rusty Vanneman, CFA. Six analysts, who conduct over 600 mutual fund portfolio
manager interviews per year, will also join the E*TRADE family. Armed with
this in-depth insight, and coupled with the firm's proprietary analytical
tools, Kobren Insight Management has a reputation for designing personalized
portfolios to meet a variety of client objectives.
About E*TRADE FINANCIAL
The E*TRADE FINANCIAL family of companies provide financial services
including trading, investing, banking and lending for retail and institutional
customers. Securities products and services are offered by E*TRADE Securities
LLC (Member NASD/SIPC). Bank and lending products and services are offered by
E*TRADE Bank, a Federal savings bank, Member FDIC, or its subsidiaries.
About Kobren Insight Management
Kobren Insight Management (KIM) is a registered investment advisor and one
of the largest independent investment advisory firms using mutual funds in the
country, managing approximately $1 billion. In addition to managing private
accounts and variable annuities for a select group of about 800 individual and
institutional clients nationwide, KIM also serves as the investment advisor to
the Kobren Insight Funds, an affiliated family of mutual funds.
Important Notices
E*TRADE FINANCIAL and the E*TRADE FINANCIAL logo are registered trademarks
or trademarks of E*TRADE FINANCIAL Corporation. The statements contained in
this news release that are forward-looking are based on current expectations
that are subject to a number of uncertainties and risks, and actual results
may differ materially. The uncertainties and risks include, but are not
limited to, changes in market activity, anticipated increases in the rate of
new customer acquisition, the conversion of new visitors to the site to
customers, the activity of customers and assets held at the institution,
seasonality, the development and enhancement of products and services,
competitive pressures (including price competition), system failures, economic
and political conditions, changes in consumer behavior and the introduction of
competing products having technological and/or other advantages. Further
information about these risks and uncertainties can be found in the
information included in the annual reports previously filed by E*TRADE Group,
Inc. or E*TRADE FINANCIAL Corporation with the SEC on Form 10-K (including
information under the caption "Risk Factors") and quarterly reports on Form
10-Q.
E*TRADE FINANCIAL Media Contact
Pam Erickson
E*TRADE FINANCIAL Corporation
617-296-6080
pam.erickson@etrade.com
E*TRADE FINANCIAL Investor Relations Contact
Adam Townsend
E*TRADE FINANCIAL Corporation
703-236-8719
adam.townsend@etrade.com
SOURCE E*TRADE FINANCIAL Corporation
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Related links:
http://www.etrade.com
CONTACT:
Media, Pam Erickson, +1-617-296-6080, or
pam.erickson@etrade.com; or Investor Relations, Adam Townsend,
+1-703-236-8719, or adam.townsend@etrade.com, both of E*TRADE
FINANCIAL Corporation
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