By Simon Jessop
LONDON (Reuters) - British insurer Standard Life (L:SL) has appointed the head of its fund management arm, Keith Skeoch, as the group's new chief executive to replace David Nish, who is stepping down after six years at the helm expanding the company's investment business.
The move comes as Standard Life sheds non-core insurance operations and looks to boost fund sales globally as well as in the UK, where the last government freed up pension investment rules.
Standard Life's board had been discussing over recent months the development of its senior management and succession planning, "to continue the delivery of our strategy," the company said in a statement.
"In the light of this, the board and David have agreed that this is the right time to hand over to his successor," it added.
Skeoch is currently chief executive of Standard Life Investments (SLI), the group's 258 billion-pound ($410 billion) asset management business which he joined as chief investment officer just after it was broken out into a separate unit in 1998. He takes over as group chief executive on Aug. 5.
For Clive Beagles, fund manager of the JOHCM UK Equity Income Fund, the fourth-biggest investor in Standard Life by fund, according to Thomson Reuters data, Skeoch's appointment made sense even if he was sorry to see Nish go.
"It's a fairly obvious move. The business is increasingly focussing on the world of savings and investments, but it's sad to see David move on as we think he's done a very good job. He's been one of the best-executing chief executives in our fund.
"There was an awful lot of criticism about the amount of money they invested in IT and the (distribution) platform, but today, most people's observations are that they are a long way ahead of most other players because of that investment."
Shares in Standard Life were up 0.08 percent at 473.9 pence by 0953 GMT, valuing the business at 9.37 billion pounds. At the same time the FTSE 100 (FTSE) index was up 0.6 percent.
The shares trade on a forward price-to-earnings multiple of 17.3, against 13.1 for rival Legal & General (L:LGEN), 13.6 for Prudential (L:PRU) and 10.2 for Aviva (L:AV), according to Thomson Reuters data.
Barrie Cornes, analyst at Panmure Gordon, said Skeoch was "a safe pair of hands" who would stick with the existing strategy, although he maintained a 'hold' recommendation on Standard Life stock as he considered it fully valued.
The shares are up by 21 percent so far this year, compared with a 1 percent fall in the FTSE 100 and 1 percent rise in the FTSE All-Share index (FTAS).
Standard Life said in discussing the succession the company had consulted leading investors, who backed the plan.
Nish had "changed the shape of Standard Life allowing us to successfully grow globally through world class investment management and distribution businesses", while Skeoch had made Standard Life Investments a "global player", Chairman Gerry Grimstone said in its statement.
"He has an exceptional understanding of world markets and the opportunities they offer, and has the right talent and experience to continue to deliver our strategy and take Standard Life on the next stage of our journey."