STT State Street Corporation

   By Colin Kellaher 
 

State Street Corp. (STT) on Friday said it reached a definitive agreement to buy Charles River Systems Inc., a premier provider of investment-management front-office tools and solutions, for $2.6 billion in cash.

The Boston provider of financial services said it will finance the purchase price in part through the suspension of about $950 million of share repurchases this year.

State Street said it plans to fund the rest of the deal through the issuance of equity, with about two-thirds in common stock and one-third in preferred stock.

State Street, which on Thursday announced a 12% increase to its quarterly common stock dividend, said the acquisition was included in its capital plan as a potential strategic change, and that the Federal Reserve granted a conditional non objection.

Charles River, based in Burlington, Mass., has offices in North America, Europe and the Asia-Pacific region and posted 2017 total revenue of more than $300 million, State Street said. The company said it expects the acquisition will add to earnings in 2020, excluding acquisition and restructuring costs.

When integrated with State Street's existing capabilities, Charles River's systems "will enable State Street to deliver a global front-to-back platform for asset managers and asset owners that will be unique in the investment servicing industry," State Street said.

Write to Colin Kellaher at colin.kellaher@wsj.com

(END) Dow Jones Newswires

July 20, 2018 06:40 ET (10:40 GMT)

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