Aberdeen Asset Management Plc (ADN) dropped in London trading following a report Macquarie Group Ltd. is planning to make a competing offer for Scottish Widows Investment Partnership.
Aberdeen said last month that it’s in talks to buy the Lloyd Banking Group Plc fund management unit, which oversees about 146 billion pounds ($235 billion) in assets and would make the Scottish firm Europe’s largest publicly traded money manager. The shares fell 4.6 percent to 422.2 pence in London, the biggest decline since Aug. 21.
Macquarie, Australia’s largest investment bank, is planning to offer about 500 million pounds in cash for SWIP within the next two weeks, Dow Jones reported citing people with knowledge of the transaction. A spokeswoman from Macquarie in London declined to comment when contacted by Bloomberg News.
“The timing seems correct” said Peter Lenardos, an analyst at RBC Capital Markets in London with an outperform rating on the stock. “Aberdeen can afford to pay cash for the unit, but they would have to do a share placing first. We will are probably going to see a run for the finish line here, but anything above 500 to 550 million pounds I would strongly encourage Aberdeen to step away.”
Aberdeen said on Oct. 24 that it would pay for the acquisition by issuing new shares to Lloyds and make further payments in cash over time, depending on SWIP’s performance.
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