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UBS scraps $1.4 billion deal to buy Wealthfront

·1 min read
FILE PHOTO: Logo of Swiss bank UBS is seen in Zurich

(Reuters) -Swiss bank UBS and Wealthfront said on Friday they have mutually agreed to terminate their $1.4 billion deal, as part of which the automated wealth management provider was to be acquired by UBS Americas Inc.

The deal, first announced earlier this year, was expected to fast-track UBS's growth in the U.S. market.

Several large financial firms including Wall Street giants JPMorgan Chase & Co, Goldman Sachs and Morgan Stanley have ventured into new client bases in recent times beyond the high-net-worth individuals they traditionally served.

The Swiss bank said it is committed to its plan of growing in the U.S. and will continue to build its digital wealth management offering.

"We are continuing to explore ways to work together in a partnership and UBS has given us $70 million in financing at a $1.4 billion valuation," Wealthfront Chief Executive Officer David Fortunato said.

The deal with Wealthfront, one of the largest digital wealth management firms known as "robo-advisers", was expected to close in the second half of the year.

(Reporting by Manya Saini in Bengaluru; Editing by Shounak Dasgupta)