City hero Schroders is to be sold to American rivals in a £9.9bn deal

Blue-blooded fund manager Schroders is to be sold to US rival Nuveen in a £9.9bn deal that will end more than two centuries of independence and reverse another setback for the London Stock Exchange.

Nuveen, part of the Teacher Insurance and Annuity Association of America (TIAA), has agreed to buy Schroder for 612p a share – a 34 per cent premium to the company’s closing price of 456p. The deal will create one of the world’s largest asset managers, overseeing around $2.5tn (£1.8tn) of assets.

The deal marks a milestone for Schroders, founded in 1804 by John Henry Schroder. The Schroder family still controls around 44 per cent of the company and is expected to get at least £4bn from the sale. Family members Leonie Schroder and Claire Fitzalan Howard currently sit on the board.

Schroders’ chairman, Dame Elizabeth Corley, said London would “remain at the heart of this enhanced business” as the group’s non-US headquarters, despite the firm’s exit from public markets.

Management said there were no plans for a “material downsizing” of the census and that both Schroders and Nuveen would continue to operate as independent brands after completion, which is expected by the end of the year.

Richard Oldfield, chief executive at Schroders from November 2024, described the deal as a strategic response to industry pressures. “In a competitive world where scale can help bring benefits, Nuveen is a partner who shares our values ​​and respects the culture we have built,” he said.

William Huffman, chief executive of Nuveen, said the project will “open up new opportunities for wealth growth with institutional investors” by expanding the company’s global footprint.

Schroders has long been part of the FTSE 100, but its growth has stalled amid structural changes in the asset management industry. Its share price fell to a decade low of 302p last April as investors turned to cheaper costs rather than paying higher fees for stock-picking strategies.

The company has also struggled to compete with US giants such as BlackRock and Blackstone, which have grown aggressively into high-profile alternatives such as private equity.

Although Schroders has pursued capital gains from the private markets, it has failed to translate those investments into sustainable shareholder returns. Under Oldfield, the company embarked on a cost-cutting program targeting £150m in savings.

Schroders’ move to the London market adds to a growing list of high-profile exits from the UK exchange, fueling concerns about the City’s ability to retain and attract major listed firms.

Nuveen said any future re-listing may involve a dual listing on London and other international exchanges.

Headquartered in Chicago, Nuveen manages $1.4tn in assets, with a focus on the US market. The acquisition will be financed with cash and £3bn in debt.

In the City of London, the sale of one of its most historic financial institutions underscores the growing pressure for consolidation that is reshaping global asset management, and a shift in the gravity of capital markets toward the United States.