Swiss financial holding company UBS has backed out of a $1.4bn deal, the amount for which it had planned to buy robo-adviser Wealthfront. It is reported that the deal was terminated by mutual agreement.
The purchase of the investment service became known in January 2021. UBS claimed that Wealthfront’s clients would not experience any change in the company’s performance after it was taken over by the financial holding company.
It is not known at this time what prompted the deal to be broken up. However, a statement released said there was a mutual agreement to abandon the takeover. Wealthfront’s acquisition process was expected to be completed in the second half of this year.
In the context of the cryptocurrency industry, this news is interesting because in the summer of 2021 the robo-service began its expansion into the digital asset market. The company has opened up clients to investment products such as Grayscale Bitcoin Trust and Grayscale Ethereum Trust.
“We are incredibly excited about Wealthfront moving forward as an independent company, and are proud to announce that thanks to the hard work of our team and the trust you have placed in us, we will have positive cash flow and EBITDA earnings in the next few months,” Wealthfront said.
As for UBS, the financial holding company still keeps the course for expansion in the U.S. The company plans to ramp up its digital wealth management offering in the near future.