Item 8.01. Other Events
Common Stock Offering
On September 9, 2021, State Street Corporation, a Massachusetts corporation
("State Street"), entered into an underwriting agreement (the "Underwriting
Agreement") with Goldman Sachs & Co. LLC and BofA Securities, Inc. (the
"Underwriters"), pursuant to which State Street agreed to issue and sell
21,724,217 shares of its common stock, par value $1.00 per share (the "Shares"),
to the Underwriters in a public offering. The offering is being made pursuant to
a registration statement on Form S-3 (File No. 333-238861) and a related base
prospectus, preliminary prospectus supplement and prospectus supplement
(collectively, the "Prospectus"), each as filed with the Securities and Exchange
Commission. The public offering price of the Shares is $87.60 per share, and the
Underwriters have agreed to purchase the Shares from State Street at a price of
$87.46 per share. State Street expects to receive net proceeds from the sale of
the Shares, after deducting estimated expenses and underwriting discounts, of
approximately $1.9 billion. The closing of the public offering is expected to
take place on September 14, 2021, subject to customary closing conditions.
The above description of the Underwriting Agreement is qualified in its entirety
by reference to the Underwriting Agreement, which is attached as Exhibit 1.1 to
this Current Report on Form 8-K and is incorporated herein by reference.
Wilmer Cutler Pickering Hale and Dorr LLP, counsel to State Street, has issued
an opinion to State Street, dated September 13, 2021, regarding the legality of
the Shares to be issued and sold in the offering upon issuance and sale thereof.
A copy of the opinion as to legality is attached as Exhibit 5.1 to this Current
Report on Form 8-K and is incorporated herein and into the Prospectus by
reference.
Risk Factors
State Street is supplementing the risk factors previously disclosed in its
Annual Report on Form 10-K for the fiscal year ended December 31, 2020 (the
"Form 10-K") with the following risk factors. These risk factors should be read
in conjunction with the risk factors included in the Form 10-K.
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Consummation of our planned acquisition of Brown Brother Harriman & Co.'s
("BBH") Investor Services business is subject to the satisfaction or closing
conditions and regulatory approvals, the failure of which may prevent or delay
the consummation of the acquisition.
On September 7, 2021, we announced that we had entered into a definitive
agreement with BBH to acquire BBH's Investor Services business, including its
custody, accounting, fund administration, global markets and technology services
for $3.5 billion in cash, subject to customary adjustments. The transaction is
targeted to be completed by the end of 2021, subject to the receipt of
regulatory approvals and the satisfaction or waiver of other closing conditions.
We cannot provide any assurance that all necessary regulatory approvals will be
obtained nor the timing of such regulatory approvals, nor can we provide any
assurance that all of the other closing conditions will be satisfied or waived.
The failure to obtain necessary regulatory approvals or the failure to satisfy
some or all of the other required conditions could delay the completion of the
acquisition for a significant period of time or prevent it from occurring.
Even if we successfully consummate our planned acquisition of BBH's Investor
Services business, we may fail to realize some or all of the anticipated
benefits of the transaction or the benefits may take longer to realize than
expected.
Our ability to realize the anticipated benefits of the planned acquisition will
depend, to a large extent, on our ability to integrate the BBH Investor Services
business into our business and realize anticipated growth opportunities and cost
synergies. The integration of the BBH Investor Services business into our
business will be a complex, costly and time-consuming process, and our
management may face significant challenges in implementing that integration,
including, without limitation, challenges related to:
• retaining the business and revenue from the BBH Investor Services
business's current clients, many of which have the right to consent to
transfer their business to State Street or to transition their business
on short notice;
• integrating the BBH Investor Services business's software solutions,
including its Infomediary® communication platform, with our existing
products and services and cross-selling our comprehensive suite of
products and services, including State Street Alpha®, to clients of the
BBH Investor Services business;
• achieving the anticipated cost and revenue synergies from the combination
of the BBH Investor Services business with State Street;
• managing systems, operational and business complexities and costs
associated with combining two different global securities servicing
platforms, including maintaining service consistency, information
security, business continuity and compliance, and controlling operational
risks associated with large-scale technology conversions; and
• transitioning the BBH Investor Services business's senior management team
of investment service partners into roles within our larger company and
retaining other key employees of the BBH Investor Services business.
Any delay or failure in achieving any of the foregoing could materially
adversely impact the expected benefits of the acquisition.
Item 9.01. Financial Statements and Exhibits
(d) Exhibits
Exhibit
No. Description
1.1 Underwriting Agreement, dated September 9, 2021, between State
Street Corporation, Goldman Sachs & Co. LLC and BofA Securities, Inc.
5.1 Opinion of Wilmer Cutler Pickering Hale and Dorr LLP, dated
September 13, 2021.
23.1 Consent of Wilmer Cutler Pickering Hale and Dorr LLP (contained in
Exhibit 5.1 above).
104 Cover Page Interactive Data File (embedded within the Inline XBRL
document)
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