State Street Corporation and Brown Brothers Harriman & Co. have agreed to pull the plug on State Street’s long-stalled acquisition of BBH’s investor services business, ending a months-long push to renegotiate a $3.5 billion price tag and restructure a deal that likely faced continued regulatory holdups.
Boston-based financial services giant State Street announced the termination of the deal on Wednesday morning. The move comes after regulators indicated approval would only come after further changes to the transaction, requiring more delays. State Street noted the increasingly complex deal structure in a challenging mergers and acquisitions environment “presented additional operation risk” and undercut the potential benefits of taking on BBH’s investor services unit.
The decision to walk away from the deal, which involves no penalties for either firm, comes almost a year after executives initially expected the transaction to close. The acquisition would have brought State Street about $5.4 trillion in new assets under custody, pushing it closer to industry leader BNY Mellon.
In a statement provided to the Business Journal, State Street said that “to continue to invest time and resources in the transaction” is no longer in the best interests of clients, shareholders or employees.
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