Standard Life Investments (SLI) has agreed a £390m deal with Phoenix Group to buy Ignis Asset Management.
Subject to regulatory approval, the deal involves the formation of a “strategic alliance” between Phoenix and SLI, which will involve SLI providing fund management services to Phoenix’s life company assets.
The acquisition will add £59bn of assets under management to SLI and is expected to complete by the end of June.
In a notice to the stock exchange this morning, Standard Life highlighted Ignis’s government bond team as a particular strength. The team runs the £2.7bn Absolute Return Government Bond fund, which has gained 18.6 per cent since launch in March 2011, according to FE Analytics.
The group also highlighted insurance company and pension fund links as another benefit of the deal.
SLI also said it has “identified material cost savings from the integration of Ignis with Standard Life Investments’ operating platform, exceeding £50m by the third full year of ownership”.
Keith Skeoch, chief executive of Standard Life Investments, said: “This acquisition is entirely complementary, deepening our investment capabilities, broadening our third party client base and strengthening our strategic position from which to develop a business in the rapidly-developing liability aware market. Standard Life Investments continues to perform very strongly.”
Ignis was launched in 2008, having previously been known as Resolution Asset Management. In the retail space it is best known for its joint ventures with specialist boutiques Argonaut, Hexam and Cartesian, all of which are now independent of the group.
Ignis also has a successful property fund, fixed income funds run by Chris Bowie and UK and European equity funds run by Graham Ashby and Ian Ormiston respectively.
Phoenix Group chief executive Clive Bannister said the company would use some of the proceeds of the sale to pay down debt, adding that the deal would allow the company to focus on managing its closed life funds and “benefit from future acquisitions through the consolidation of closed life funds and our long term strategic alliance with Standard Life Investments”.
