Shareholders consulted on Standard Life merger with Aberdeen

Merger between Standard Life and Aberdeen Asset Management expected to get the go-ahead despite governance concerns.
Merger between Standard Life and Aberdeen Asset Management expected to get the go-ahead despite governance concerns.
0
Have your say

Shareholders will have their say on Standard Life’s merger with Aberdeen Asset Management today amid governance concerns over the £11bn tie-up.

The deal requires the backing of at least 75 per cent of Aberdeen shareholders and 50 per cent of Standard Life investors to get the go-ahead, but experts believe the merger will be given the all clear despite unease over the joint chief executive structure and a bumper 16 member board.

The combined entity, to be called Standard Life Aberdeen, will be headed up by Keith Skeoch and Aberdeen boss Martin Gilbert.

Mr Skeoch said last month it was “abundantly clear” both men would be required at the helm in order to “get things done”.

David McCann, analyst at Numis Securities, said he believed the deal will be voted through by shareholders. “Future success in the active asset management industry will be determined by being big or small/boutique: you do not want to be stuck in the middle,” he said.

Eyebrows have also been raised over the proposed bonus structure that will see chief investment officer Rod Paris eligible to earn 865 per cent of his £450,000 base salary.

But prospects for investor approval have been boosted after two influential shareholder advisory groups, Institutional Shareholder Services and Glass Lewis, threw their weight behind the tie-up.

If it gets the green light, the merger will create Europe’s second-biggest fund manager with £670bn under management.

The merger, which was agreed in March, is targeting cost savings of £200m a year, with around 800 out of 9,000 jobs expected to be lost.