Standard Life saw its share price rocket yesterday after it announced the acquisition of Ignis Asset Management for £390m.
The insurance and pensions specialist saw its shares shoot up seven per cent to 400p per share after the purchase was announced. The deal signals a shift towards investment management and away from its core business for Standard Life.
Keith Skeoch, chief executive of Standard Life Investments, said the move would take place in a controlled way with a unified management team.
Chief executive of parent group Standard Life David Nish added: “The acquisition of Ignis continues the delivery of our group strategy to grow assets under management through enhancing our investment capabilities and expanding our offering to meet the changing needs of our customers. It will deliver enhanced earnings and cash generation and support future growth in revenues.”
Ignis has been bought from Phoenix Group Holdings, which will enter into a partnership deal with Standard Life Investments as part of the acquisition.
The deal will boost Standard Life’s presence in the asset management market, with 81 per cent of its revenues now coming from fund management. The share price rise increased the company’s stock market value by £550m, much more than the £390m price tag for Ignis.
BEHIND THE DEAL
FENCHURCH | MALIK KARIM
Karim has been in the City for 30 years and is the founder and chief executive of Fenchurch. He advised on Insight, Investec Asset Management, Invista and now Ignis deals.
A chartered accountant, he is also a Leeds United fan and ran the marathon in 2008 with colleague Chris Deville, who also worked on the Ignis deal. Together they raised over £105,000 for Great Ormond Street, Chance to Shine and the Aga Khan Foundation.
A typical day will be spent with core blue chip clients like Standard Life, Investec and LV= with whom he has had long term relationship and has executed numerous transactions.
Fenchurch Advisory Partners acted as the sole financial advisors on the deal, with JP Morgan Securities acting as brokers. Slaughter and May provided legal advice. PR was provided by Tulchan Communications and supported by Standard Life’s in-house team led by Barry Cameron and Brian Simmons.