Charles Schwab and TD Ameritrade’s planned $26 billion merger has cleared a major regulatory hurdle with the Department of Justice approving the transaction, Schwab announced early Thursday.
“We’re gratified by the DOJ’s [June 3] decision and appreciate its diligent and thorough review,” according to Schwab President and CEO Walt Bettinger.
“We are pleased to be clearing an important milestone in our planned acquisition of TD Ameritrade and look forward to today’s scheduled votes by the stockholders of our two companies, which represent another important step toward completion of the transaction,” Bettinger explained in a statement.
The DOJ’s Antitrust Division launched a second request in the discovery procedure earlier this year in order to review the potential anti-competitive impacts of the deal, which was announced in November.
“There have been questions over the concentration of business tied to registered investment advisors … but the DOJ in its investigation, according to sources, apparently did not see any violation,” CNBC reporter David Faber said in an interview on that channel early Thursday before Schwab released the news.
“This deal is well on its way to closing,” Faber noted.
Last week, one analyst gave the deal a strong chance of completion.
“We believe the merger is more likely than not to occur and currently incorporate a 75% probability of its going through in our valuation model,” said Michael Wong, Morningstar’s director of equity research for financial services, in a recent report.
Both firms said recently that they expected the merger to be completed in the second half of 2020. Integration between the two companies, though, could take between 18 and 36 months, according to TD Ameritrade Institutional President Tom Nally.