Key Takeaways
- • BlackRock has won a competitive tender to manage £30bn of Scottish Widows' index strategies after parent Lloyds terminated a major contract with Standard Life Aberdeen, according to Money Marketing.
- • Aberdeen Asset Management had managed nearly £110bn in Scottish Widows Investment Partnership funds before its merger with Standard Life.
- • Lloyds argued the merged firm competed with Scottish Widows and removed it from the mandate; Standard Life Aberdeen has contested the decision in arbitration.
- • BlackRock and Scottish Widows will enter a "strategic partnership" covering alternative asset classes, risk management and investment technology.
- • Scottish Widows says the future of the remaining £80bn of funds is close to being finalised.
Summary
BlackRock has won a bidding war to manage £30bn of Scottish Widows' index strategies, according to Money Marketing, after its parent company Lloyds Banking Group terminated a major contract with Standard Life Aberdeen to run the money. Aberdeen Asset Management had managed nearly £110bn in Scottish Widows Investment Partnership funds before its merger with Standard Life.
Lloyds said it believed the merger brought Aberdeen into competition with Scottish Widows, and therefore cut the combined firm off the mandate. The two parties have since been in arbitration proceedings, with Standard Life Aberdeen contesting the legality of the decision. Its position is that, having sold its own life arm to Phoenix, it could not be in competition with Scottish Widows.
Following a lengthy tender process, BlackRock has been selected to run the £30bn portion. The two firms will also form a "strategic partnership" in which they will work together on "alternative asset classes, risk management and investment technology." Scottish Widows says the outcome for the remaining £80bn of funds is close to being finalised.
Scottish Widows chief executive Antonio Lorenzo said BlackRock was selected "following a competitive tender process in which it clearly demonstrated its global market leading capabilities and deep expertise in the UK market." He added that the partnership "will ensure that Scottish Widows and the group can deliver good investment outcomes for its customers over the coming years."
Lloyds said it believed the merger brought Aberdeen into competition with Scottish Widows, and therefore cut the combined firm off the mandate. The two parties have since been in arbitration proceedings, with Standard Life Aberdeen contesting the legality of the decision. Its position is that, having sold its own life arm to Phoenix, it could not be in competition with Scottish Widows.
Following a lengthy tender process, BlackRock has been selected to run the £30bn portion. The two firms will also form a "strategic partnership" in which they will work together on "alternative asset classes, risk management and investment technology." Scottish Widows says the outcome for the remaining £80bn of funds is close to being finalised.
Scottish Widows chief executive Antonio Lorenzo said BlackRock was selected "following a competitive tender process in which it clearly demonstrated its global market leading capabilities and deep expertise in the UK market." He added that the partnership "will ensure that Scottish Widows and the group can deliver good investment outcomes for its customers over the coming years."
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