Schwab Will Acuire ETF Manager Windward For $150M

Charles Schwab SCHW, the largest U.S. discount brokerage, said it will acquire Windward Investment Management for $150 million in cash and stock to bolster its footprint in the ETF business. Windward Investment Management had about $3.9 billion in assets under management as of the end of July. The firm manages those assets across three ETF-heavy portfolios. California-based Schwab said it expects the deal to add "modestly" to earnings in the year following the deal's completion. Schwab said Monday it had seen a 38% jump in ETF usage among its clients from June 2009 to June 2010, and it noted that a research firm estimates that ETFs will see a compound annual growth rate of 23% between 2010 and 2014, according to the Wall Street Journal.