Ally Financial Confirms Acquisition Of TradeKing

Ally Financial Inc ALLY announced on Tuesday it has agreed to acquire TradeKing Group, a digital wealth management company.

The acquisition announcement follows earlier reports, such as from The Wall Street Journal, that such a deal would be announced on Tuesday.

TradeKing's offering consists of an online broker/dealer for self-directed investors and professionally-managed portfolios. The company boasts approximately $4.5 billion in client assets, including $1.1 billion in cash and cash investments.

Ally Financial has agreed to acquire TradeKing for approximately $275 million and is expected to have a marginal impact on its 2016 and 2017 results due to the transaction costs. The company did however add that the deal will be accretive in 2018 with "meaningful growth potential" in the future given an ongoing shift in consumer preferences towards digital wealth management services.

The acquisition remains subject to the appropriate regulatory approval from the Financial Industry Regulatory Authority (FINRA) and and compliance with the Hart-Scott-Rodino Antitrust Improvements Act, as well as satisfaction of other customary closing conditions.

"The addition of wealth management is the next key step in Ally's digital product evolution and will create a powerful combination of segment-leading direct banking and innovative investment services in a single integrated customer experience," said Ally Chief Executive Officer Jeffrey Brown. "This transaction presents a compelling opportunity for customers and a logical growth opportunity for Ally."