Aberdeen Asset Management will acquire Scottish Widows Investment Partnership Group and its related private equity and infrastructure fund management businesses from Lloyds Banking Group under a long-term agreement, confirmed Aberdeen spokesman James Thorneley.
As part of the deal, Aberdeen will offer Lloyds £550 million ($886 million) worth of shares, equivalent to a 9.9% stake in Aberdeen. Additionally, there will be an “earn-out” payment based on performance of up to £100 million payable in cash over a five-year period after completion of the acquisition.
The transaction is expected to close in the first quarter of 2014.
SWIP will add to Aberdeen about £136 billion in assets under management with annualized revenue of about £234 million. As of Sept. 30, Aberdeen managed $324.6 billion of AUM globally.
According to Mr. Thorneley, the transaction, among other things, will strengthen Aberdeen's product capabilities with bonds.
Matthew Smith, a Lloyd's spokesman, said this transaction was part of the bank's strategy to focus on its core business and dispose of its non-core operations.
