Aberdeen Asset Management Plc (ADN) is close to buying Scottish Widows Investment Partnership from Lloyds Banking Group Plc (LLOY), a purchase that will make it Europe’s largest publicly traded money manager, said two people with knowledge of the matter.
Aberdeen, Scotland’s largest money manager, may pay about 500 million pounds ($806 million) in shares for the division, said the people, who asked not to be identified because the talks are private. The agreement may be announced as soon as tomorrow, the people said.
The purchase would increase Aberdeen’s assets to about 350 billion pounds, allowing it to surpass Schroders Plc (SDR) as Europe’s biggest publicly traded fund company. It would also mark a reversal of Aberdeen’s strategy to focus on growth without acquisitions and returning cash to investors. Chief Executive Officer Martin Gilbert had previously called an acquisition of Scottish Widows (SWIPRTA) Investment “highly unlikely.”
Lloyds CEO Antonio Horta-Osorio, 49, has been seeking to strengthen the lender’s balance sheet by selling assets, cutting costs and eliminating jobs following the bank’s bailout by the government in 2008. The London-based lender purchased Scottish Widows, which runs a life-insurance business and the SWIP fund-management operation, for 7.3 billion pounds in 2000.
The Sunday Times reported the talks earlier today.
Lloyds hired Deutsche Bank AG this year to advise on the sale of SWIP, which oversaw 145.8 billion pounds at the end of the first half.
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