Aberdeen Asset Management will begin the process of integrating SWIP into its stable next month after regulators yesterday approved a £660m deal for the fund manager.
Chief executive Martin Gilbert was “delighted” after the Financial Conduct Authority approved AAM’s swoop for Edinburgh-based Scottish Widows Investment Partnership, the asset management arm of Lloyds Banking Group.
The regulatory green light for the takeover come less than six months after AAM was forced to reveal its interest in the company as speculation in the City mounted.
“We will continue to work closely with SWIP and Lloyds Banking Group to ensure a smooth completion process,” Mr Gilbert said yesterday.
“The way we have already worked together to develop a structured integration plan is very encouraging and means that the migration process will begin very shortly after completion.
“This cooperation confirms my belief that the combination of the two businesses and our strategic relationship with Lloyds will be of great long-term benefit to our shareholders and clients, whom I would like to thank for their continued support throughout this process. Everyone at Aberdeen is looking forward to working with our new colleagues from SWIP.
“The deal combines and broadens the investment capabilities of both businesses.
“The combined business will have a far stronger and more diverse range of investment management skills as well as significant scale across asset classes and geographies, which will enable us to deliver an even better service for our enlarged client base.
“This includes investors who will benefit from yesterday’s Budget announcement giving them more freedom to invest their pension pots when they retire.”
The £560m deal for SWIP has been funded through the issue to Lloyds of 131.8m new shares in AAM, equivalent to a 9.9% stake in the north-east asset manager.
Up to a further £100m will be payable depending on SWIP’s performance over the next five years.
It is thought around 150 jobs will be cut from the combined 2,500-strong AAM/SWIP workforce by the time the two companies are fully integrated, a process that could take up to two years.
AAM shares yesterday fell 4.10p to 374p.