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Standard Life Aberdeen hints at ‘combining platforms’ under merger

Companies’ merger prospectus points to 800 job cuts over three years


Standard Life is staying tight-lipped about the future of Aberdeen
Asset Management-owned platform Parmenion after the companies’ merger prospectus hinted at platform consolidation within the combined group.

Documents relating to the merger were released last week, revealing approximately 800 jobs – nearly 10 per cent of the combined companies’ workforce – would be cut in the three years following the proposed tie-up.

Together the companies own three investment platforms. Standard Life has its own-branded Wrap platform and also owns Elevate, which it acquired from Axa last year. Aberdeen acquired Parmenion in 2015.

Standard Life has been clear it intends to keep Elevate and Standard Life Wrap as separate offerings after conducting adviser research.

On the subject of platforms, the merger prospectus says: “The Standard Life group and the Aberdeen group currently use their own different platforms for relationship management with advisers, which will be brought together in the combined group.”

It adds: “Advisers using both plat-forms may choose to move assets away from one or both platforms following the merger due to a lack of confidence in the combined group, a lack of support for the merger, or the actual or perceived strategic and business priorities of the combined group or otherwise.

“Any change to or termination of client relationships or relationships with particular intermediaries or platforms as a result of the merger or otherwise could have a material adverse effect on the business, sales, financial results, financial condition and growth prospects of the combined group.”

Since the prospectus was published, Standard Life has reiterated its intention to retain Elevate as a standalone platform.

Money Marketing understands discussions with Parmenion have not yet started. A Parmenion spokeswoman says it is too early to share information.

A Standard Life spokeswoman says: “We are looking forward to working with Parmenion when the proposed merger completes.”

Although the companies expect to save £200m a year once the merger is complete, the cost of integration will set them back around £320m, paid upfront.

In the prospectus documents, Aberdeen and Standard Life say they will look to combine premises where both organisations already operate from multiple locations near each other.

The merged business will be renamed Standard Life Aberdeen and will operate under branding drawn from both the Standard Life Group and the Aberdeen Group.

It is expected that the combined group will be reorganised to bring together Aberdeen and Standard Life’s investment functions in a single investment group that will be given the interim name Aberdeen Standard Life Investments Limited, pending a review of the global brand strategy.

The merged group will be headquartered in Scotland and continue to have offices around the world.

Standard Life chairman Gerry Grimstone will head the board of the new entity, with Standard Life chief executive Keith Skeoch and Aberdeen chief executive Martin Gilbert set to become co-chief executives.

In a trading update, Standard Life said it had realised net investment inflows of £3.1bn in the first quarter of 2017, excluding its Global Abso-lute Return Strategies, which saw outflows of £2.8bn.

Workplace net inflows stood at £400m.


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