Money Shareholders consulted on Standard Life merger with Aberdeen Asset Management

10:50  19 june  2017
10:50  19 june  2017 Source:   Press Association

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The merger of Standard Life and Aberdeen Asset Management will lead to the loss of 800 jobs, it has been confirmed. The £11.3bn deal will see Aberdeen shareholders own a third of the combined entity, with Standard Life shareholders owning the rest.

SHAREHOLDERS will have their say on Standard Life ’s merger with Aberdeen Asset Management today amid governance concerns over the £11billion tie-up. By Holly Williams. PUBLISHED: PUBLISHED: 00:01, Mon, Jun 19, 2017.

Standard Life and Aberdeen Asset Management merger © PA PICTURE DESK Standard Life and Aberdeen Asset Management merger

Shareholders will have their say on Standard Life's merger with Aberdeen Asset Management on Monday amid governance concerns over the £11 billion tie-up.

The deal requires the backing of at least 75% of Aberdeen shareholders and 50% of Standard Life investors to get the go-ahead, but experts believe the merger will be given the all clear despite unease over the joint chief executive structure and a bumper 16 member board.

The combined entity, to be called Standard Life Aberdeen, will be headed up by Keith Skeoch and Aberdeen boss Martin Gilbert.

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"It is the most capital-heavy part of our business, so I would be quite happy to dispose of that book of business if I can get benefit for shareholders . Back-book of assets . The proposed merger between Standard Life and Aberdeen is the culmination of a years-long journey to ramp up the

Image: Standard Life and Aberdeen Asset Management are two of the UK's biggest fund managers .

Mr Skeoch told the Press Association last month it was "abundantly clear" both men would be required at the helm in order to "get things done".

David McCann, analyst at Numis Securities, said he believed the deal will be voted through by shareholders.

He said: "Future success in the active asset management industry will be determined by being big or small/boutique: you do not want to be stuck in the middle.

"We think the deal reflects Aberdeen and Standard Life choosing to be big."

The merger will make the combined group a top 20 player worldwide by assets under management, he added.

Eyebrows have also been raised over the proposed bonus structure that will see chief investment officer Rod Paris eligible to earn 865% of his £450,000 base salary.

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Image caption Aberdeen boss Martin Gilbert is expected to be co-chief executive of the combined business. Fund managers Aberdeen Asset Management and Standard Life have agreed terms for an all-share merger .

Image: Standard Life and Aberdeen Asset Management are two of the UK's biggest fund managers .

But prospects for investor approval have been boosted after two influential shareholder advisory groups, Institutional Shareholder Services and Glass Lewis, threw their weight behind the tie-up.

As well as institutional shareholders, Standard Life will also have to convince a sizeable number of retail investors, which make up half of its share register.

Totalling 1.2 million people, these individual shareholders are spread across the UK.

The deal also faces regulatory scrutiny, with the Competition and Markets Authority last month launching an investigation to ascertain if the tie-up could harm competition within the industry.

If it gets the green light, the merger will create Europe's second-biggest fund manager with £670 billion under management.

The merger, which was agreed in March, is targeting cost savings of £200 million a year, with around 800 jobs expected to be lost over a three-year period from a global workforce of 9,000.

Stenson stars at Hero Challenge .
Henrik Stenson has signed up to compete in the Hero Challenge ahead of the Aberdeen Asset Management Scottish Open. "We have embraced shorter formats like the Hero Challenge and the recent GolfSixes tournament to appeal to new audiences and this one-hole straight knockout contest provides fast-paced entertainment, whilst showcasing the considerable skill of our players."The Aberdeen Asset Management Scottish Open will be the fourth event in the European Tour's new Rolex Series, a premium category of tournaments on the Race to Dubai with minimum prize funds of $7million.

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