Standard Life and Aberdeen Asset Management have agreed to an all-share £11.3 billion ($18.2 billion) merger to create one of the largest active investment managers globally.
Aberdeen said in an announcement that the combined group will be headquartered in Scotland and in due course be branded to incorporate the names of both Standard Life and Aberdeen.
Existing Standard Life shareholders would own 66.7 per cent of the combined group, and Aberdeen shareholders 33.3 per cent, the announcement said.
The group would become one of the largest active investment managers globally with £660 billion of pro forma assets under administration.
Standard Life chief executive, Keith Skeoch, and Aberdeen chief executive, Martin Gilbert, would become co-CEOs of the combined group.
“The combination of our businesses will create a formidable player in the active asset management industry globally,” Skeoch said.
“We strongly believe that we can build on the strength of the existing Standard Life business by combining with Aberdeen to create one of the largest active investment managers in the world and deliver significant value for all of our stakeholders.”
Gilbert said the merger brought financial strength, diversity of customer base and global reach to ensure that the enlarged business could compete effectively on the global stage.
Also commenting, Aberdeen chairman, Simon Troughton said the strategic fit created a business with minimal client overlap and was diversified by revenues, asset class, and distribution channels.
“The combination will result in a material enhancement to earnings and this, coupled with a strong balance sheet, will facilitate signification investment in the business to support growth, innovation, and a progressive dividend policy,” he said.
