Manchester investment platform lined up as potential £1.5bn takeover target

Manchester online investment platform, Interactive Investor (II) is being lined up as a £1.5bn takeover target by FTSE-100 asset manager abrdn.

Sky News reported that abrdn is in exclusive talks with II, whose owner and chief executive, Richard Wilson, began moves earlier this year to achieve a stock market listing.

And this morning abrdn confirmed that it is “currently in discussions with J.C. Flowers & Co regarding a potential acquisition of Interactive Investor”.

It added: “There can be no certainty that these discussions will result in a transaction and a further announcement by the company will be made as and when appropriate.”

It is understood that any deal with abdrn would ensure Mr Wilson remained in place at II, Britain’s second biggest retail investment platform.

J.C. Flowers is II’s biggest shareholder.

Reports claim a deal between the two companies could be sealed this month.

If so, it would end II’s preparations for a stock exchange placing to join rivals Hargreaves Lansdown and Manchester-based AJ Bell on the London market.

II has more than 400,000 personal investing clients, placing it behind only Hargreaves Lansdown in terms of UK market customer numbers. It has around £57bn of assets under administration.

The acquisition would be a key move by Stephen Bird, who took control of abrdn in July 2020.

He is understood to be keen to pursue targeted acquisitions to help spread its revenue base across the three areas of investment, adviser and personal.

Last month, abrdn completed a smaller deal for Finimize, a subscription-based investment tips service, which indicated the group’s move towards personal investing-oriented activities.

The acquisition of II is expected to be paid for from abrdn’s surplus regulatory capital of about £2bn.

Abrdn manages more than £530bn for clients. It has a market capitalisation of just under £5.6bn.

JP Morgan is reported to be advising abrdn on the talks, while II and its shareholders are being advised by Fenchurch Advisory Partners and UBS.