Aberdeen looks to swoop on Swip to build £350bn group
editor:
0131-620 8462 Aberdeen Asset Management yesterday revealed that it is in talks to buy rival Scottish Widows Investment Partnership (Swip) from Lloyds banking Group in a deal that would create the largest listed fund management group in europe.
A deal, which could value edinburghbased Swip at around £500 million, would take Aberdeen’s funds under management to almost £350bn.
Although Aberdeen stressed there was no certainty that a deal would be done, it outlined the likely structure of a transaction that would be funded by handing new shares in Aberdeen to Lloyds and cash payments conditional on future performance. It also said it would involve the formation of a strategic partnership with Lloyds.
but industry sources said Aberdeen is not the only party interested in the business and the bank expects to make a decision on a preferred bidder by the end of the year.
Aberdeen said that the transaction would offer substantial cost savings and would boost profits, supporting the company’s commitment to dividend increases and the return of surplus capital to shareholders.
Although Aberdeen has been touted in recent months as a possible buyer of Swip, the company has previously played down speculation of its interest and the announcement came as something of a surprise to analysts.
Owen Jones at Shore Capital pointed out: “If the deal were to go ahead, it would be against all recent management rhetoric and, indeed, against market expectations.”
Peter Lenardos of