T. Rowe Price, the Baltimore asset manager with about $1.9 trillion under management, agreed late Thursday to acquire F/m Investments for an undisclosed sum, adding a fast-growing fixed-income ETF specialist to its lineup.
F/m manages about $19 billion in total, with more than $10 billion of it in 20 ETFs and the rest in separately managed accounts. Modest as that is next to T. Rowe's total AUM, it would more than double the assets T. Rowe holds in its own fixed-income ETFs, a corner of the market where the firm has been a minor player despite its size.
T. Rowe currently has 10 U.S.-listed fixed income ETFs with $6.5 billion in them. Across all categories, it has 34 ETFs with almost $33 billion in AUM.
F/m pioneered single-bond ETFs, funds that continuously hold a single Treasury tenor, such as the latest on-the-run 10-year note, giving investors more precise control over their exposure than a fund like the iShares 7-10 Year Treasury Bond ETF (IEF), which holds a range of maturities.
Its flagship is the F/m US Treasury 3 Month Bill ETF (TBIL), which at $7.2 billion accounts for more than 70% of F/m's ETF assets and charges 0.15% a year.
Since launching its initial suite of single-bond funds, F/m has kept innovating. It created an ultrashort take on inflation-protected bonds, the F/m Ultrashort Treasury Inflation-Protected Security ETF (RBIL).
It also designed the F/m Compoundr U.S. Aggregate Bond ETF (CPAG), which rotates among broad bond ETFs to sidestep distributions, and therefore taxes, giving investors a way to hold bonds as a diversifier without generating yield.
The firm was also the first to launch a dual-share-class ETF and has filed a first-of-its-kind application for tokenized ETF shares.
For T. Rowe, the acquisition of F/m brings in a focused, methodical issuer whose products are clearly resonating with investors. The firm manages roughly $1.9 trillion in total, but ranks just 29th among US ETF providers.
Buying F/m brings instant scale in fixed-income ETFs and a team with a record of building products investors want, at a moment when T. Rowe's leadership has made growing the ETF business a priority.
The deal is the second acquisition of an ETF manager announced this month. Last week, Goldman Sachs agreed to buy NEOS Investments for up to $2.25 billion, months after closing its roughly $2 billion purchase of Innovator Capital in April.
Together the deals are a part of a wave of consolidation taking place across the $16.3 trillion U.S. ETF industry, as large asset managers buy their way into the fast growing industry. The T. Rowe transaction is expected to close in early 2027.