A Swiss bank has agreed to purchase Merrill Lynch’s international wealth management business from Bank of America (NYSE:BAC).
The Julius Baer Group (PINK:JBAXY) will pay $882 million for the business. The acquisition will increase Baer’s assets under management by 40%. The firm has been looking to expand its operations outside Switzerland as regulatory pressures shrink domestic profits, Reuters noted.
Baer will also acquire more than 2,000 former Merrill Lynch employees under the deal, which will be partially funded with shares, giving Bank of America a 3% stake in the firm.
Bank of America acquired Merrill Lynch in 2008 for $50 billion during the financial crisis. The non-U.S. wealth management unit has lost money for the last several years.
Investors were not happy with the news. Shares of Julius Baer dropped more than 6% in Monday morning trading in New York, following similar declines on European exchanges.
Analysts cited by Reuters called the purchase ”defensive and value-destructive” and expressed skepticism over the wisdom of adding a money-losing business to Baer’s operations.