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Aberdeen completes £550m Swip acquisition and targets cost-savings

Aberdeen completes £550m Swip acquisition and targets cost-savings

Aberdeen has completed the acquisition of Scottish Widows Investment Partners (Swip) and said it expects the deal to be earnings enhancing from year one as it looks to cut costs.

The acquisition, which creates a combined group with £324.5 billion in assets under management, will cost Aberdeen £550 million in total and see Swip’s parent Lloyds Banking Group take a 9.9% stake in the fund manager.

In a stock market update, Aberdeen said the integration of Swip will start immediately and is expected to take 24 months. It added that the deal will bring ‘significant cost savings’ although it is aiming to achieve a reduction in overheads ‘over and beyond the synergies from the Swip integration.’

In a separate announcement, Aberdeen said it has seen a further £3.9 billion of outflows in January and February although it estimates that these have dropped down to £0.2 billion in March. The group said inflows into emerging market debt, high yield and property have partly offset outflows from its Asian and emerging market equity funds.

Chief executive Martin Gilbert (pictured) said: ‘We are pleased to have completed this important acquisition as planned and on schedule, so that we can now commence the task of integrating Swip into the enlarged Aberdeen Asset Management group. We will immediately begin a structured migration of funds and platforms, whilst continuing to deliver an excellent investment performance for both existing and new clients.

‘The enlarged group is well placed to meet the needs of a diverse range of investors with a broad range of capabilities across both geographies and asset classes.

‘We look forward to developing our new strategic relationship with Lloyds and, on behalf of everyone at Aberdeen, I would like to welcome our new colleagues from Swip into the group.’

Aberdeen provided no guidance on any likely redundancies.

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Profile: Kevin Doran's formula for success at AJ Bell

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From a degree in theoretical physics to teaching and becoming one of the youngest chief investment officers in the UK, Kevin Doran has certainly had an interesting career.

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