FTSE 100’s asset manager, Abbrdn, is seeking to deepen its direct consumer business by signing an agreement to acquire Interactive Investor, the UK’s second largest fund supermarket, for £ 1.5 billion.
Abrdn confirmed in a statement on Saturday that it is currently in talks with JC Lowers and Co, a private equity group that has held a majority stake in Interactive Investor since 2016. This transaction may be announced within a few weeks. Added. Abrdn works with JP Morgan bankers.
With the acquisition of Interactive Investor, Abrdn will have a business with more than 400,000 customers and managing around £ 55 billion. Stephen Bird, CEO of Abrdn, said this year he is hunting to expand his presence in the UK advisory and consumer markets. Its direct sales are the smallest business line within an asset management company.
The acquisition by Abrdn looks like this: Integration It continues to dominate the asset management industry as a whole, with pressure on fees, long-term low interest rates and tighter regulation. Such a transaction invalidates Interactive Investor’s initial public offering plan. Was exploring Against the backdrop of the personal investment boom during the pandemic.
Interactive Investor said negotiations with Abbrdn are underway, but there are approaches from other parties and IPOs are also an attractive option. “Discussion around [IPO] The process is also underway, “said Interactive Investor.
The acquisition of institutional investors is the most eye-catching move to date by Bird, who held the reins of a company that failed to meet its promises, which was established through the acquisition of rival Standard Life by Aberdeen Asset Management last September. prize. ..
Bird has made it clear that Abrdn will pursue growth through acquisitions, and emphasizes the need to invest in technology to expand its digital direct consumer savings and wealth offerings. As of June 30, Abrdn’s surplus regulated capital was £ 2.8 billion.
In April Standard Life Aberdeen announced that it was to do Rename Part of a push to Aberdeen to put off a difficult year of years. When the merger was completed in August 2017, the newly created group had assets of £ 670 billion. Since then, assets under management have fallen to £ 465.3bn as of June 30. This is because the company has been suffering from a customer outflow for many years. Abrdn has lost its position as the UK’s largest standalone asset management company to Schroders.
Interactive Investor occupies about one-fifth of the retail investment platform market and competes with listed rivals Hargreaves Lansdown and AJ Bell. The group is driving the integration of the wealth management sector, purchasing a consumer investment platform from rival Equiniti for £ 48.5 million in March.
Analysts at broker Numis said Interactive has acquired virtually all UK platforms that share a fixed billing model, questioning whether there is room for further growth through further transactions.
The talk, first reported by Sky News, comes after Abbrdn agreed to buy startup Finimize last month, giving investment tips to about a million retail investors. In Abrdn’s six-month results, the group has flagged UK advisors and consumer markets as strategic priorities, in addition to technology, private markets, responsible investment and growth in Asia.
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