Deal announced for £1.49bn acquisition of Manchester investment platform
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Asset manager abrdn has confirmed plans for the £1.49bn acquisition of Manchester subscription-based investment platform, Interactive Investor (II).
Reports of a potential bid for II emerged almost a month ago.
Both have a shared vision of the growth and development of the wealth market and a commitment to being the customer champion, said abrdn, adding that the acquisition will significantly enhance its presence and growth opportunities within a fast growing and attractive market.
Stephen Bird, abrdn chief executive, said: “This is a unique opportunity and a transformative step in delivering our growth strategy. Interactive Investor is the UK’s number one subscription-based investing platform with a powerful reputation as a consumer champion – abrdn’s scale, resources, and shared vision will enable interactive investor to grow confidently and expand its leadership position in the UK’s attractive savings and wealth market.
“I am delighted that Richard Wilson and his team will continue to lead Interactive Investor.”
Interactive Investor chief executive, Richard Wilson, said: “This is an exciting new chapter in our history and means that we can focus exclusively on serving those who matter most: our customers.
“We will have access to abrdn’s additional capabilities across research, advice and wealth management services, and we will benefit from being part of one of Europe’s largest investment and wealth management firms, with a vision and values closely aligned to our own.
“Our management will remain the same, and the same extraordinary team will continually develop our service and technology, while maintaining our subscription pricing, our whole of market choice and the same campaigning spirit and editorial independence.”
Completion of the deal is subject to regulatory consents and abrdn shareholder approval.
Interactive Investor has more than 400,000 customers and AUA (assets under administration) of approximately £55bn.
The UK direct investing market benefits from accelerating demographic and structural market trends. In combination, the high tech, high touch models of Interactive Investor and abrdn can enable clients to become better investors and create more opportunities for their financially secure futures, said abrdn.
It added that the acquisition is a material step in its building of a leadership position in the personal wealth market, with AUMA (assets under management and administration) in the personal vector increasing nearly fivefold to £69bn on a pro forma basis.
As part of the acquisition, Richard Wilson will join abrdn and continue to lead Interactive Investor, which will operate as a stand alone business within abrdn’s personal vector.
The acquisition is expected to be double-digit earnings accretive in the first full financial year following completion.
The deal will be funded in cash from abrdn’s capital resources. Following the acquisition, abrdn said its capital position will remain strong with an indicative pro forma regulatory capital surplus of £500m and in addition around £2.5bn of value from its listed investments.
It said it intends to issue additional Tier 1 debt of around £200m to optimise its capital structure.