UBS has signed a definitive agreement to sell Correspondent Services Corporation (CSC), a division of UBS PaineWebber, to Fidelity Investments for a price believed to be in the region of $300 million and $340 million.
A member of the New York Stock Exchange, CSC focuses on providing clearance, execution, settlement, administrative and management information services to approximately 150 brokerage clients and others within the financial services industry.
Joseph Grano, chairman and chief executive officer, UBS PaineWebber says the transaction enables the firm to focus on its primary wealth management business. Referring to CSC, he adds: "Increasingly, this business requires scale, and this transaction enables Fidelity to accelerate the growth of its core clearing business."
The transaction is expected to close during the second quarter of 2003.
UBS expects to breakeven on the transaction after the deduction of $120 million in taxes and other costs. UBS PaineWebber has agreed to provide certain services to clients of the acquired business during the next year to ensure an orderly transition.