Virgin Money and Aberdeen Standard Investments have signed a conditional sale agreement for the asset manager to acquire a 50% stake (less one share) of Virgin Money Unit Trust Managers (VMUTM).
The proposed joint venture, which is subject to regulatory approval, will combine Virgin Money’s brand, scale and retail distribution expertise with ASI’s investment solutions and asset management technology and digital expertise.
Under the terms of the agreement, Virgin Money will, subject to certain conditions, receive an upfront cash payment of £40m plus 50% of an amount representing:
(a) the capital in the business at completion; and
(b) certain other costs.
Transform retail investment proposition
VMUTM holds Virgin Money’s investment and pensions business, offering a range of investment products; including unit trusts, pensions and stocks and shares Isas.
The joint venture will enable Virgin Money to provide customers with access to a broader range of funds and solutions at a competitive cost, and is expected to transform Virgin Money’s retail investment proposition, driving significant growth in funds under management and capital-efficient returns as well as offering excellent value for shareholders.
David Duffy, chief executive of independent banking group CYBG, owner of Virgin Money, Clydesdale Bank and Yorkshire Bank, said: “Using our brand and customer reach, combined with ASI’s clear asset management strengths we will be able to provide a truly compelling investment and pensions proposition to our retail customers.”
Martin Gilbert, co-chief executive at Aberdeen Standard Investments, said: “The signing of the [agreement] that encompasses Virgin Money, Clydesdale Bank and Yorkshire Bank customers is an important milestone in progressing our joint venture with Virgin Money.”
