SCOTTISH fund management heavyweight abrdn has confirmed it is in talks to buy the Interactive Investor savings platform business in a deal it is thought could be worth around £1.5 billion.
Edinburgh-based abrdn said it is in discussions with private equity firm J.C. Flowers & Co regarding a potential acquisition of Interactive Investor.
The takeover under discussion would give abrdn control of a business that has become a leading player in the market for the provision of internet-based platforms on which private investors can manage their portfolios and of related share dealing services.
Interactive Investor describes itself as the UK’s number one flat-fee investment platform, with assets under administration approaching £55 billion and over 400,000 customers.
These could potentially provide a market for the investment management products sold by abrdn, which changed its name from Standard Life Aberdeen from July.
The group was formed by the merger of Standard Life with Aberdeen Asset Management in 2017. It decided to focus on investment management after concluding that market offered better prospects than the life and pensions business in which Standard Life made its name.
READ MORE: New owner of Standard Life name notes value of brand and associated pensions business
It has faced challenges after suffering outflows of funds.
If abrdn pays the £1.5bn for Interactive Investor mooted by market watchers, the deal would be the biggest struck by the group since Stephen Bird became chief executive last year. He previously spent two decades at Citigroup.
Interactive Investor has headquarters in Manchester. J.C. Flowers acquired a controlling interest in the business in 2016.
abdrn said there could be no certainty that the discussions with J.C. Flowers would results in a transaction.
A spokesperson for Interactive Investor said the business has attracted interest from a number of parties. Discussions with abrdn are ongoing but there can be no certainty that they will result in a transaction.
The spokesperson added: “An IPO (initial public offering) remains an attractive and possible outcome, and discussions around the process are also under way.”
READ MORE: Standard Life creates financial services jobs in Edinburgh
Interactive Investor could decide to float on the stock market, and to complete a related sale of shares through an IPO.
Edinburgh-based Aegon UK has developed a big platform business through acquisitions after focusing on the life and pensions business for years.
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