Standard Life Aberdeen sells its insurance business for £3.2bn

Standard Life Aberdeen's 2017 results saw the group's reported adjusted pre-tax profit rise to £492mln, up from £385mln in 2016, with pro forma fee-based revenue slipping slighting to £1.8912bn from £1.920bn.

The updates mark a boost for the company, which recently suffered a heavy blow as Lloyds Banking Group (LON:LLOY) moved to pull out £109 billion of assets under management from the group.

However, the group said it saw strong demand for emerging market debt and multi-asset solutions such as MyFolio and diversified growth funds.

The sale came as Standard Life Aberdeen updated investors on its full-year performance, posting a rise in assets under administration from £647.6 billion to £654.9 billion in 2016, and revealing net outflows of £31 billion, marking an improvement on the prior year's £36.8 billion outflows.

The results are its first as a combined business since...

Scottish Widows said it could reconsider the mandates if Standard Life Aberdeen made changes to ensure it was not competing in Scottish Widows' core areas.

It will also enable Standard Life Aberdeen to accelerate its growth strategy through targeted investments.

Completion of the acquisition is expected during the third quarter of 2018.

The transformation of Standard Life Aberdeen into a pure investment management business accelerated yesterday when it confirmed the £3.2 billion sale of its insurance division to a smaller rival.

"This completes our transformation from a capital-heavy insurance business", Keith Skeoch, co-chief executive, said.

It added that owning advice business and platforms allowed the investment manager to have "greater proximity" to retail customers.

"In partnering with Phoenix Group, whose expertise is in administering and servicing long-term savings, Standard Life Aberdeen is able to realise attractive value for the disposed businesses, while continuing to benefit from access to related assets and flows".

The firm also announced Sir Gerry would be stepping down as chairman from the board by the end of 2019 after 11 years.

Julie Chakraverty, Lynne Peacock and Akira Suzuki will retire from the board at its next annual general meeting. Numis Securities lifted their target price on shares of Standard Life Aberdeen from GBX 445 ($6.15) to GBX 481 ($6.65) and gave the company a "hold" rating in a report on Friday, October 27th.

  • Eleanor Harrison