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Rating:Madison Dearborn Sells Nuveen For $6.25B Not Rated 0.0 Email Routing List Email & Route  Print Print
Monday, April 14, 2014

Madison Dearborn Sells Nuveen For $6.25B

News summary by MFWire's editors

We have all been waiting for this deal for nearly a year. Nuveen has ended its seven year Odyssey with Madison Dearborn Partners. The surprise is the place where that Odyssey ended: TIAA-CREF is the buyer.

The deal is valued at $6.25 billion and will create a combined asset manager of nearly $800 billion AUM, but it also brings together very different firms.

At the end of last year TIAA-CREF had $569 billion in AUM while Nuveen reported $221 billion. Combined that totals $790 billion at the end of 2013. Barring large changes in those numbers over the past three months, TIAA-CREF is paying 2.83 percent of AUM for Nuveen (including 0.79 percent of AUM in cash, and the rest in assumption of debt).

MFWire could not immediately reach spokespeople for Nuveen and TIAA-CREF for comment on the deal. However, the two firms did give an interview to reporters at the Wall Street Journal.

While the WSJ had not reported on the deal while it was being negotiated, the MFWire reported that Madison Dearborn was seeking a buyer for the business after scrapping plans for an IPO in the first half of 2013.

The WSJ cites TIAA-CREF chief executive Roger Ferguson declaring that "this transaction takes us into the top ranks of mutual funds."

TIAA-CREF is a dominate player in the higher education market for 457 plans and has more recently built a franchise in the college savings plan market. Yet, it has failed to make inroads with the retail advisor market and has struggled to establish itself in 401(k) market.

Nuveen is known as a leading player in the closed-end fund space and a leader in alternative asset classes.

How the two disparate business will come together through the deal is an interesting question. 

Edited by: Tommy Fernandez


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