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Updated from 10:02 am EDT.

Nuveen Investments


said Wednesday it has agreed to a $6.3 billion buyout offer from a private-equity group led by Madison Dearborn Partners.

The money management firm also said chairman and CEO Timothy R. Schwertfeger, who has held his current position since 1996, will step down as CEO effective July 1, although he will retain a role as a non-executive chairman. John P Amboian, who has served as the company's president and a director since 1999, will become the new CEO.

Nuveen stockholders will receive $65 in cash for each share of common stock, representing a premium of 20% over Tuesday's closing price and a 26% premium over the 90-day average closing price of $51.56.

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Including the assumption of $550 million of debt, the total value of the offer is $6.3 billion.

Nuveen's stock surged to a new high on the news. Around midday, it was trading at $63.16, up $9, or nearly 17%. Previously, the stock had never traded above $56.20.

Schwertfege said a press release that the transaction will provide Nuveen with the capital it needs to expand its mutual fund and institutional money managment business.

He said that management expects to participate in the buyout.

However, Amboian clarified during a subsequent conference call that he and other executives "have not engaged in any dialogue with Madison-Dearborn at this point in time on management opportunity."

Nuveen had $166.1 billion in assets under management as of March 31, 2007. The company runs $53.09 billion were in closed-end funds, $19.58 billion were in open-end mutual funds and $93.42 billion were in accounts for wealthy individual and institutional investors.