Asset company in £40bn fund deal

Finance company Aberdeen Asset Management is to take over £40bn of Credit Suisse's fund management business in a move worth £250m.

The deal will create the UK's largest listed fund management group and see investment banking giant Credit Suisse take a 25% stake in Aberdeen.

The takeover is expected to be completed by the end of June.

Aberdeen said it would operate from a "reduced cost base", with reports it could shed about 30% of staff.

Scottish-headquartered Aberdeen saw its shares race 10% ahead on news of the deal, which is said to have been rushed through ahead of the year end.

"This transaction fits perfectly within our strategy"
Martin Gilbert
Aberdeen Asset Management

The firm already has about £100bn in assets under management and will take on another £40bn from Credit Suisse's traditional fund management operation, which has a presence in Europe and the Asia Pacific.

Martin Gilbert, chief executive of Aberdeen, said: "The acquisition confirms Aberdeen's position as a leading global asset manager and provides us with greater access to the distribution network of Credit Suisse and its private banking division, one of the world's largest wealth managers.

"This transaction fits perfectly within our strategy, a key part of which has been to make earnings-enhancing acquisitions which give the business critical mass in our core competencies."

Credit Suisse put its long-only, traditional fund management business up for sale after a strategic review earlier this year.

Profits increase

The group manages assets largely spanning fixed income, European money market funds and equities.

Aberdeen has grown by acquisition in recent years, having secured the takeover of Deutsche Bank fund management businesses in 2005.

It spent more than £18m integrating the Deutsche Bank acquisitions, but is said to have achieved success in aligning the two businesses.

Aberdeen reported an £800m increase in pre-tax profits for the year to 30 September.

The Aberdeen-based business has primary operations in London, Luxembourg and Sydney, with the deal expanding its operations across Australia, Germany, Italy and Japan.

RELATED INTERNET LINKS
Aberdeen Asset Management
Credit Suisse
The BBC is not responsible for the content of external internet sites