On Saturday 4th March 2017 Standard Life Investments and Aberdeen Asset Management announced a proposal to merge. With a number of funds of both companies featuring in the Square Mile Academy of Funds, we wanted to briefly outline our thinking on this potential merger and what effect we believe it will have for investors.
It is important to note that at this stage the deal is only a proposal and remains subject to approval by shareholders. This means that there are unlikely to be immediate impacts on clients. That said, assuming that the merger goes ahead we would expect the groups to rationalise fund ranges to some extent. The ranges of the two groups are, in many areas, complimentary, with Aberdeen having a strong Asian and Emerging Market equity franchise, whilst Standard Life Investments is better known for their pioneering flagship Global Absolute Return Strategies (GARS) fund, as well as developed market equity products and fixed income solutions. However, there are clearly investment teams and products which will overlap to a greater or lesser extent and over time we would expect the newly formed entity to consolidate some of these in order to make cost savings. Exactly how this happens remains to be seen, but with continued pressure on asset managers to cut costs, such rationalisation seems inevitable.
For now we see no reason to believe that there will be changes to any of the funds that we recommend to clients, and we have no intention of removing the ratings from any of Standard Life Investments' or Aberdeen's funds. We will, of course, keep a close eye on the situation and update investors as events develop.
Currently rated by 0 people