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FATAL ATTRACTION?

The merger of Standard Life and Aberdeen is a sign of the times in asset manager consolidation, but who will be the winners and losers from the trend?

Industry analysis Asset manager M&A

The industry was already abuzz with talk about consolidation and whispers of potential targets well before Standard Life pulled the trigger and initiated the takeover of Aberdeen Asset Management (see page 4).

But the match-up between the insurance and investment giant with a fund group that saw consistent multi-billion pound outflows over 2016 changed the dynamic of the conversation. It was no longer a question of whether the industry would consolidate further, but rather when.

Passive aggressive

Some fund houses, sensing the new found urgency of the situation, addressed the elephant in the room shortly after the £11bn Standard Life/Aberdeen union. Maarten Slendebroek, chief executive at Jupiter, kicked off the firm’s annual investment dinner by defiantly declaring to the room: “We are not looking to be acquired by anyone.” At its core, Jupiter’s lean, people-centric business model is incompatible with M&A activity, he told the audience.

But by the end of the speech, Slendebroek had softened his stance, offering a more realistic prognosis: “With any luck we’ll be back here next year as an independent company,” he said. Because that’s just it – no listed asset manager, large or small, can say with 100% certainty they will never consider merging with or being taken over by a competitor to stay alive in the current climate.

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