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British asset manager abrdn buys interactive investor for $2 billion

Stock MarketsDec 02, 2021 12:56
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© Reuters. FILE PHOTO: Businessman toy figure is placed on U.K. Pound coins in front of displayed Abrdn logo in this illustration taken, November 8, 2021. REUTERS/Dado Ruvic/Illustration

By Carolyn Cohn and Sachin Ravikumar

(Reuters) -Abrdn is to buy investment platform interactive investor for 1.49 billion pounds ($1.98 billion) in cash, as traditional asset managers seek to build up customers using online providers.

Banks and asset managers are looking at ways to capture a new breed of investors who tend to be younger and invest directly, rather than seek financial advice.

JPMorgan Chase (NYSE:JPM) has bought British digital platform Nutmeg in June as part of the U.S. bank's expansion into the UK retail banking and investment market.

Abrdn is buying interactive investor from shareholders, including a fund advised by private equity firm JC Flowers and members of interactive investor's management, it said in a statement. Interactive investor has around 55 billion pounds in assets under administration.

"We wanted to buy a business that was building into the areas of high secular growth...we want to get those platform effects," abrdn CEO Stephen Bird told a media call, adding the purchase would increase the size of abrdn's retail investment business fivefold.

Interactive investor CEO Richard Wilson will join abrdn and continue to lead the platform, the asset manager said.

Wilson said the deal meant interactive investor would have access to "abrdn’s additional capabilities across research, advice and wealth management services."

Abrdn, which has 532 billion pounds in assets under management and administration, is issuing 200 million pounds in capital-boosting debt alongside the deal.

Shares in abrdn, created via a merger of asset managers Standard Life (LON:ABDN) and Aberdeen, fell 2.3%.

Abrdn shares have dropped 45% since the merger completed in Aug 2017 amid concerns about its performance.

KBW analysts said the asset manager's "chequered recent history of M&A transactions will likely increase investor scepticism in the near term," reiterating their "market perform" rating on the stock.

($1 = 0.7509 pounds)

British asset manager abrdn buys interactive investor for $2 billion
 

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Comments (6)
Ian Green
Ian Green Dec 02, 2021 14:03
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Theyve lost income from assets taken out last yrThere preformance is hardly brilliant i hope they dont do many more purchases concentrate on core biz
Niall Spillane
Niall Spillane Dec 02, 2021 13:01
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I suspect this is a purchase of assets because the Ii platform is pretty crap (cheap but crap)
John Doe
John Doe Dec 02, 2021 13:01
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I would say its a good platform, but expensive.
Graham Kinnear
Graham Kinnear Dec 02, 2021 12:13
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Not convinced this is good for customers. ABDN isn't exactly a player that thinks outside the box. I can see price increases in the not to distant future.
matt dickinson
matt dickinson Dec 02, 2021 11:51
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Probanly a good idea because there is scope to improve
Craig Stevens
Craig Stevens Dec 02, 2021 11:29
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Really bad deal - interactive invedtor is hopeless esp compared to thrblikes of freetrade - doesnt compete on any level. Has Aberdeen ever used the platform ?!
Daniel Peate
Daniel Peate Dec 02, 2021 11:19
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Nice!!
 
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