Aberdeen Asset Management to buy Lloyds' Scottish Widows for $1.1 bn
18 November 2013
Aberdeen Asset Management Plc today agreed to buy Lloyds' fund management arm Scottish Widows Investment Partnership Group Limited (SWIP) for about £660 million ($1.1 billion).
Under the all-share deal, Aberdeen will pay shares worth £560 million or 9.9 per cent of the company, and 100 million in cash over five years as earn-out payment depending on growth delivered by the strategic relationship with Lloyds in the Investment Solutions business.
Lloyds has agreed to retain its entire shareholding for a minimum of 12 months, retain two thirds of its holding for at least two years, and retain one third of its holding for at least three years.
The acquired business includes the Investment Solutions division of SWIP, a separate investment group that is responsible for the design, development and management of investment solutions for Lloyds' wealth clients.
The acquired business is debt-free and will have net assets of £60 million at completion of the acquisition including SWIP's related private equity and infrastructure fund management businesses.
The strategic deal will operate across Lloyds' wealth, insurance, commercial banking and retail businesses.
The acquired business will add approximately £136 billion of assets under management with annualised revenues of around £234 million to Aberdeen Asset Management.
Martin Gilbert, CEO of Aberdeen Asset Management said, ''This transaction is significant for the long-term prospects of Aberdeen in a number of ways. It strengthens our investment capabilities and adds new distribution channels; the acquisition of SWIP adds scale to our business across a range of asset classes; and it also introduces a strategic relationship with Lloyds Banking Group.''
Aberdeen is the parent company of a global independent asset management group. Formed out of a management buy-out in Aberdeen, Scotland, in 1983, Aberdeen is a FTSE 100 company operating in over 23 countries across Europe, Asia and the Americas.
As at 30 September 2013, Aberdeen managed assets of £200.4 billion on behalf of institutional and private investors.