<div id="readability-page-1"><div><div><div><div><p>Just several months ago, Richard Oldfield was adamant – Schroders, the 222-year-old fund manager founded during the Napoleonic Wars, was not for sale.</p><p>The Schroders family, who hold a 44pc stake in the business, were “tremendously supportive” of the business, and Mr Oldfield, who took over as chief executive in November 2024, was insistent that the company would deliver on the rest of his transformation plan.</p><p>Even as rumours swirled that the dynasty could finally cash out, the firm maintained that the dozen or so Schroder family members who own the stake intend to retain “a substantial shareholding in the company over the long term”.</p><p>But on Thursday, all of that changed. In a major shock to the City, Schroders announced that it had succumbed to a £10bn takeover from US funds group Nuveen – ending the Schroder family’s two centuries-long association with the City of London.</p><p>The change of heart emerged just a few weeks ago, when the fund manager received its first takeover approach from Nuveen.</p><p>Secret talks between the two sides about a deal – which was codenamed “Project Pantheon” – progressed rapidly, with the pair operating in secret under the code names “Aphrodite” and “Zeus” to keep the merger under wraps in the notoriously gossipy City.</p><p>Lazard, a similarly esteemed old City name, was drafted in to advise the Schroders family’s Principal Shareholder Group vehicle – with agreement from senior members of the clan finally reached in recent days.</p><p>The family, who have been a force in the City of London broadly since its creation, stand to make around £4.3bn from the sale, which will likely mark the end of their involvement in the firm.</p><p>The sale is a blow for the City and marks the end of one of the longest and most distinguished chapters in British finance, with only the Rothschilds or Warburgs on par with the Schroders for historical City significance.</p></div></div><div><div><p>It’s not the first time that the Schroder family has conceded defeat to Wall Street.</p><p>In 2000, the family – then led by Bruno Schroder and his brother-in-law George von Mallinckrodt – sold its merchant bank to Citigroup for £1.35bn after accepting it could never compete with the balance sheet of America’s most powerful banks.</p><p>The family’s involvement in Schroders has shrunk in the ensuing years. Philip Mallinckrodt, the last family member to be an executive at the company, left the board in 2020.</p><p>However, Leonie Schroder, who owns Hurstbourne Park, a 485-hectare Hampshire estate, and is the daughter of Bruno Schroder, along with Claire Fitzalan Howard, the daughter of George von Mallinckrodt, still sit on the company’s board but have little involvement with the day-to-day operations.</p><p>Just like at the turn of the millennium, Schroders has found itself outgunned by their bigger American rivals. Mr Oldfield said that the Nuveen takeover would give it the heft to take on its much greater Wall Street rivals.</p><p>“It isn’t that we had to do this,” Mr Oldfield said. “What became really clear is, as we started to get to know Nuveen, the complementarity of this combination accelerates what we could do on our own by a decade.</p><p>“In an industry that is changing and consolidating quite rapidly, this actually is a phenomenal ability to put us in the driving seat in the industry. If we were on our own, we would be less able to do that.”</p><p>For ex-employees at Schroders, Thursday’s sale is bittersweet.</p><p>Richard Buxton, who spent 12 years at the firm, said that he had been bombarded with messages from friends in the City describing the takeover as the end of an era.</p><p>“In a way it is, of course; they’ve been listed here an awfully long time,” he said.</p><p>He said the declining influence of the family owners, combined with its powerful brand, meant it was always a likely takeover candidate.</p></div></div><div><div><p>“Ultimately, the family ceased to have any management involvement,” he said. “It just looks such an obvious thing to happen. I’m not surprised at all.”</p><p>Like many British asset managers, Schroders has found itself battling a number of unfavourable headwinds, such as the increasing draw to the United States and its mega-cap tech stocks.</p></div></div><div><div><p>Ben Williams, an analyst at Shore Capital, said, “If you look at funds investing in UK equities, the data is moderately horrific, because UK funds have been in outflows forever, and that’s been a significant part of what has suppressed the valuation of these businesses and opened up this gap.”</p><p>At the same time, the popularity of passive investment into more affordable index and exchange-traded funds has grown inexorably.</p><p>With $2.5tn (£1.8tn) in assets under management, the combined group would rival giants such as Capital Group, the world’s largest active-only investor, which has around $3tn in assets.</p><p>Since taking over as chief executive, Mr Oldfield has axed a number of the group’s businesses, ending a joint venture with Lloyds Bank and exiting smaller operations in places such as Brazil and Indonesia.</p><p>While the share price has risen 28pc over his short tenure, it has done little to address the fundamental challenges facing the business.</p><p>“Many strong franchises in the UK are trading at a discount to intrinsic value and as a result are attracting interest from corporate and private capital acquirers,” a fund manager at a rival asset manager admitted.</p><p>Arguably, Schroders has been slow to grow its private markets business, where fees are higher and investors are more long-term.</p><p>Nuveen’s strength in the sector will help address the weakness, and the combined group will have a private markets franchise with more than $414bn in assets.</p></div></div><div><div><p>The takeover will not consign the Schroders brand to history. It will be retained by Nuveen, and the group’s London office will be its largest by headcount. Cost-cutting does not appear to be front of mind, either.</p><p>“We’ve been very clear that this is not a cost synergy transaction,” William Huffman, Nuveen’s chief executive, said. “This is about growth.”</p><p>Schroders said that Nuveen, which is privately owned, had committed to a dual listing on the London Stock Exchange if it went public in the future, but there was no commitment that London would be the main home of a publicly listed Nuveen.</p><p>For now, Schroders will join a growing list of public British companies swallowed up by American investors, including Darktrace, the British cybersecurity firm, and car parts group Dowlais.</p><p>The UK’s shrinking public markets once concerned the boss of Schroders. At an industry conference less than four months ago, he argued that listed companies were vital for transparency and holding management to account.</p><p>“We have to be careful to call the death of public markets ... They are super important to our futures,” he said at the time.</p><p>However, Mr Oldfield was adamant that, in any case, his deal did not represent a blow to the City of London.</p><p>“We’re committed to London. We’re committed to helping people in London. We are committed to supporting infrastructure investment across the UK,” he said.</p><p>“If anyone thinks this is a step back from the UK or a step back from London, they haven’t really read the details of the deal.”</p></div></div></div></div></div>

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<p>Schroders, the historic 222-year-old fund manager, has agreed to a £10bn takeover by US funds group Nuveen, marking the end of the Schroder family's long association with the firm. Despite previous assurances of retaining a substantial shareholding, the family will reportedly make around £4.3bn from the sale. The decision follows a rapid progression of secret talks, highlighting the challenges faced by Schroders against larger American rivals. CEO Richard Oldfield emphasized that the merger would enhance the firm's competitive position in a consolidating industry.</p>

Shock in the City as Schroders family cash out after 222 years