L&G considers ETF acquisition

L&G considers ETF acquisition

Legal and General may use some of the proceeds from the sale of overseas businesses to expand into the ETF space, chief executive Nigel Wilson has said.

Mr Wilson told analysts that divestments of businesses such as L&G France could prompt the acquisition of an ETF business, as well as expansion in America and possible digital financial technology deals.

Mr Wilson said: “On use of proceeds, I think there are a few areas that we’d like to spend some money on. LGIM America is going so well, so we‘d like to accelerate that growth.

“We continue to look at the ETF space where again we are doing classic build/buy analysis. If we are to spend the proceeds [of divestments] that’s an area I like.”

The insurer said early last year it was interested in expanding into the exchange-traded fund arena but has yet to make any concrete steps. The firm offers a single exchange-traded fund via a joint venture with Source.

L&G’s passive business is currently focused on its range of index-trackers, which held £275bn in UK assets as of June 30, according to the group’s interim results released last week.

Speaking to analysts following publication of the results, Mr Wilson also addressed speculation about the possible sale of Cofunds, saying the company has been examining “strategic options” for the platform in future.

He said: “We’ll update the market when we’ve got something concrete to say. But we’re looking at [...] lots of interesting ideas as to how we might be able to leverage the Cofunds platform going forward.”