James Gorman’s wealth push is lifting the fortune of Eaton Vance Corp.’s top executive.

Thomas Faust, the asset manager’s chairman and chief executive officer, is the firm’s largest individual shareholder with a stake of about 3% and a host of stock options. Their combined value soared to more than $250 million after Morgan Stanley agreed to pay $7 billion for Eaton Vance, 38% above its closing price Wednesday.

Faust, 62, an Arkansas native, joined Eaton Vance in 1985 as an equity research analyst after working at International Paper Co. He rose through the ranks as a portfolio manager and director of research and management. He assumed his current roles in 2007 and assets under management have since risen to $500 billion from about $160 billion.

Faust navigated the industry-wide shift to cheaper passive funds by leaning on fixed-income and customized portfolio offerings to generate consistent inflows.

The per-share consideration for Eaton Vance’s investors will be $28.25 in cash and 0.5833 shares of Morgan Stanley, the bank said in a statement Thursday. The Boston-based asset manager’s stock rose 48% to $60.58 at 2:43 p.m. in New York.

Stock Options
Faust, who owns more than 3.2 million shares of Eaton Vance outright, also holds more than 2.8 million stock options worth at least $64 million, with some having yet to vest, according to calculations by Bloomberg News based on regulatory filings.

Unvested awards are typically cashed out if an executive departs within a couple of years of a transaction, but if the person stays the securities are usually replaced with awards in the combined company.

Faust will become chairman of Morgan Stanley’s wealth and investment-management division when the deal is completed, reporting to Daniel Simkowitz, a representative for the bank said. He’ll also join Morgan Stanley’s management committee.

This article was provided by Bloomberg News.