Disagreement over how to structure a combined Scottish Widows / Standard Life pension provider have left the deal dead in the water and was the trigger for Lloyds Banking Group’s (LBG) withdrawal of £109bn of assets from Standard Life Aberdeen, according to media reports.
Last week Corporate Adviser reported that the withdrawal of the assets by Lloyds, which had gone to Aberdeen following its purchase of Scottish Widows Investment Partnership back in 2014, signalled the likely end of the rumoured merger between the two Edinburgh-based life insurance giants.
The Sunday Times reported yesterday that the deal fell apart because of a dispute over the structure of the new company, with LBG wanting to retain control of the operation by making it a subsidiary while Standard Life Aberdeen favoured the creation of a joint venture run as standalone company. Without an agreement, LGB chief executive Antonio Horta-Osorio decided to pull the assets from Standard Life Aberdeen.
LBG Standard Life Aberdeen’s share price took a 7 per cent hit as a result of the announcement of the withdrawal of the assets by LBG.
LBG is due to publish its results on Wednesday.
Corporate Adviser contacted both providers for comment on the alleged collapse of merger talks.