E*TRADE Financial Corporation’s $170 million Acquisition of One Million Retail Brokerage Accounts


E*TRADE was advised by Credit Suisse and Skadden, Arps, Slate, Meagher & Flom LLP. Capital One Financial was advised by Centerview Partners, Berkshire Partners, and Wachtell, Lipton, Rosen & Katz.

E*TRADE Financial Corporation has entered into a definitive agreement to acquire more than one million retail brokerage accounts with $18 billion in customer assets from Capital One Financial Corporation for a purchase price of $170 million. As of December 31, 2017 these accounts carried $1.9 billion in customer cash, as well as $0.2 billion in customer margin balances.

E*TRADE expects the transaction to be relatively neutral to earnings in 2018 and approximately $0.06 accretive in 2019 when full run-rate synergies are expected. The Company intends to fund the transaction with existing corporate cash. The transaction is expected to close during the third quarter of 2018, subject to customary closing conditions and regulatory approvals.

The Skadden team includes: Financial Institutions M&A partner David Hepp (Picture), counsel Justin Askew, and associates Christopher Gandia and Harshini Kanduru; Tax partner Edward Gonzalez and associate Loren Lembo; Investment Management partner Heather Cruz and associate Lyuba Docheva; Financial Institutions Regulation and Enforcement partner Brian Christiansen (Washington, D.C.); and Intellectual Property and Technology counsel Andrew Woodard.

Involved fees earner: David Hepp – Skadden Arps Slate Meager & Flom; Justin Askew – Skadden Arps Slate Meager & Flom; Christopher Gandia – Skadden Arps Slate Meager & Flom; Harshini Kanduru – Skadden Arps Slate Meager & Flom; Edward Gonzalez – Skadden Arps Slate Meager & Flom; Loren Lembo – Skadden Arps Slate Meager & Flom; Heather Cruz – Skadden Arps Slate Meager & Flom; Lyuba Docheva – Skadden Arps Slate Meager & Flom; Brian Christiansen – Skadden Arps Slate Meager & Flom; Andrew Woodard – Skadden Arps Slate Meager & Flom;

Law Firms: Skadden Arps Slate Meager & Flom;

Clients: E*TRADE Financial Corporation;