Abrdn agreed to sell its discretionary fund management business abrdn Capital to LGT for £140 million ($169 million), as part of its refocus on the personal wealth market, the firm said Tuesday.
Abrdn said it is divesting the discretionary fund management team but will retain part of it — the managed portfolio service business — to support the growth of its private wealth business. The discretionary fund management business manages assets for high net worth individuals and charities.
The MPS team will be added to abrdn's adviser team. The firm's adviser business provides financial planning solutions and technology to U.K. financial advisers.
The deal, which is expected to complete in the second half of 2023, will see £6.1 billion in assets under management and approximately 140 employees transfer to LGT.
"We are establishing one of the U.K.'s leading personal wealth businesses, and this deal represents an important step forward in our strategy to focus on our high-growth, platform-led, businesses. Our track record over the past two years shows that where we identify non-core capabilities, we will look to divest and redeploy capital in ways that better align with the interests of our investors, clients and customers," Stephen Bird, abrdn CEO, said in a news release Tuesday.
LGT said in a separate news release the deal further strengthens its position in the U.K.
LGT's wealth arm, LGT Wealth Management, will increase its assets under management to around £28 billion following the transfer of abrdn's assets.
"The business' strong investment performance and ESG-strategy make it a perfect fit for LGT. We are convinced that, in turn, our stability, entrepreneurial spirit, focus on excellent client service and investment expertise, make us a reliable and attractive partner for our future clients," Prince Max von und zu Liechtenstein, chairman of LGT, said in the release.
Abrdn Capital delivered around £40 million in revenue in 2022, and currently serves around 4,000 clients, abrdn said.
Also Tuesday, abrdn said its assets under management and administration fell 7.7% over the year to Dec. 31, to £500 billion. Institutional assets fell 6.9% to £161.9 billion.
Total net institutional and wholesale outflows were £11.6 billion in 2022 driven by net outflows from equity strategies.