Wells Fargo & Co. and First Interstate Bancorp will continue to be players in the money management industry, particularly on the individual asset management side, if Wells' offer to acquire the Western regional bank succeeds.
Despite the sale of Wells Fargo Nikko Investment Advisors to Barclays PLC this summer, Wells Fargo still has asset management capabilities in the individual asset management market that it can combine with First Interstate's, said Paul Hazen, chairman and chief executive officer of Wells Fargo. The bank has $65 billion in personal trust accounts, mutual funds and 401(k) assets.
According to Pensions & Investments' 1995 Money Managers Directory, First Interstate's money manager, First Interstate Capital Management, San Diego, has $20.9 billion in total assets, of which $5.1 billion are tax-exempt (P&I, May 15). First Interstate spun off its other investment management subsidiary, Denver Investment Advisors, when it sold its controlling stake last year in a management buy-out.
Wells Fargo & Co. proposed to purchase First Interstate in a stock transaction valued at $133.50 per share. Mr. Hazen said the offer has no timeframe or expiration deadline, but added he hopes to hear from the board of First Interstate shortly.
The transaction, totaling $10.1 billion, would be the largest bank merger in U.S. history.