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BNY Mellon Signs an Agreement to Take Over Archer Holdco

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The Bank of New York Mellon Corporation (BK - Free Report) has agreed to acquire Archer Holdco, LLC, which is a leading technology-enabled service provider of managed account solutions to the asset and wealth management industry.

The completion of the deal, subject to regulatory approvals and other customary closing conditions, is expected in the fourth quarter of 2024. However, financial terms have not been disclosed. The transaction is not expected to have any material impact on BNY Mellon’s earnings.

Archer provides comprehensive middle and back-office solutions to asset and wealth managers so that they can address the managed account needs of institutional, private wealth and retail investors.

With the help of its fully integrated, cloud-based platform, Archer allows its clients to expand distribution, streamline operations, launch new investment products and deliver personalized outcomes to a broader market.

With this acquisition, BNY Mellon should be able to enhance its enterprise platform to support retail managed accounts. Along with augmenting BNY Mellon’s existing asset servicing capabilities for managed accounts, Archer will provide BNY Investments and BNY Pershing’s Wove wealth platform for advisors with expanded distribution of model portfolios and access to its multi-custodial network.

Management’s Say

According to Emily Portney, the global head of asset servicing at BNY Mellon, “Managed accounts are one of the fastest-growing investment vehicles in the asset management industry, enabling investment advisors and asset managers to offer customized portfolios to retail investors at scale. By combining Archer's market-leading capabilities with BNY's broader footprint and expertise, BNY will offer fully integrated, end-to-end retail managed account solutions across our entire platform.”

Bryan Dori, the president and CEO of Archer, stated, “Today's asset and wealth managers have a strong desire to create multi-asset solutions across a variety of products, along with direct indexing and tax optimized portfolios, to meet the needs of their distribution partners and investors. As a new addition to the BNY platform, Archer's expertise, capabilities and scale will be leveraged across all of BNY to help even more clients drive long-term growth for their businesses.”

BK’s Price Performance & Zacks Rank

Over the past six months, BK shares have risen 22% compared with the industry’s 13.2% growth.
 

Zacks Investment Research
Image Source: Zacks Investment Research

Currently, BNY Mellon carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Acquisitions by Other Finance Firms

Bridgewater Bancshares Inc. (BWB - Free Report) announced that it will acquire First Minnetonka City Bank. The consideration will be fully settled in cash and include a minimum tier 1 capital requirement by the First Minnetonka City Bank.

The deal is expected to be closed in the fourth quarter of 2024, subject to regulatory approvals. The operational integration is projected to be completed by the second quarter of 2025.

First Minnetonka City Bank will be merged with Bridgewater Bancshares’ subsidiary, Bridgewater Bank, upon the closing of the transaction, at an anticipated pre-tax merger cost of $2.7 million ($2 million post-tax).

The deal is anticipated to be 15% accretive to BWB’s 2025 earnings with a tangible book value earn-back period of less than three years.

Old Second Bancorp, Inc. (OSBC - Free Report) signed an agreement with First Merchants Corp. to acquire its five Illinois branches alongside certain branch-specific loans and deposits. These branches are located in Southeast Chicago MSA.

The acquisition is expected to strengthen OSBC’s status as one of the largest banks headquartered in Chicago and significantly expand its existing branch network, specifically in the Southeast Chicago market.

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