FTSE 100 asset manager abrdn has finalised its £1.5bn takeover of Interactive Investor, the UK’s second-largest fund supermarket, in its third major digital investment this year.
In a deal that adds Interactive Investor’s over 400,000 customers and assets under administration of around £55bn to its portfolio, abdrn will acquire 100 per cent of the platform’s ordinary share capital from its shareholders.
This includes private equity group JC Flowers’ majority shareholding through its fourth LP fund, which it has owned since 2016.
Under the takeover plans, Richard Wilson will join abrdn and continue as CEO of Interactive Investor, which will operate as a standalone business within the asset manager’s ‘Personal’ vector.
“This is a unique opportunity and a transformative step in delivering our growth strategy,” abrdn CEO Stephen Bird, who has been pushing into UK adviser and consumer markets since he took the helm last September.
Meanwhile, in a statement confirming its acquisition, Interactive Investor said the asset manager is “highly supportive” of its ethos as a “consumer champion in direct investing, which has positively differentiated ii in the market”.
It also said its platform would “continue to lobby for enhanced retail access to IPOs under abrdn’s ownership.”
Meanwhile, Wilson said that Interactive Investor will have access to “abrdn’s additional capabilities across research, advice and wealth management services, and we will benefit from being part of one of Europe’s largest investment and wealth management firms, with a vision and values closely aligned to our own.”
Subject to regulatory approval, the transaction is expected to complete in the second quarter next year.
Today’s news puts an end to any potential IPO plans for DIY stockpicking platform Interactive Investor, which it insisted was an “attractive and possible outcome” a mere few weeks ago – representing a different strategy to rival investment platforms Hargreaves Lansdown and AJ Bell, who are both listed in London.
The takeover marks Stephen Bird’s most significant move yet as he prioritises abrdn’s expansion into digital investment services, capitalising on the retail investing platform boom that began during the pandemic, as non-professional investors began trading stocks from the comfort of their own homes in massive numbers.
It would come hot on the heels of the firm’s acquisition of retail investing content platform Finimize, with its 1m daily newsletter subscribers and 40,000 paid content subscribers, at the end of last month.