The sun is out, siblings, and it is harder even for me to be grumpy when there is a little heat to feel. I’m in a good mood anyway having had a legendary couple of days watching Scandinavian melodic death metal in Utrecht; something I wholeheartedly recommend. Gigs in Utrecht, I mean; they don’t have to be metal. But you’d probably be happier if they were. Have a listen to the music choice to find out for sure.
I was gallivanting last week as the news of the Standard Life acquisition of Aegon UK broke, and whilst we appreciate them timing the announcement so Steve could at least mention it, it was a bit too late to cover it in depth. Let’s put that right.
There’s a thing in Edinburgh, or at least there was, called the “Edinburgh dance” where you moved round the original versions of Scottish Widows, Scottish Life, Standard Life, Scottish Amicable and Scottish Equitable. If you completed all five you got, I don’t know, a jacket or something, or probably a Peter Principle seat on an exco somewhere. I managed three of those and it nearly broke me; it’s not for the faint-hearted.
Anyway, if we were to do an update to the Edinburgh Dance a year or so ago, the names would be Scottish Widows, Royal London, Aberdeen, Aegon and, I suppose, Phoenix. Scot AM got assimilated by Pru and isn’t really Embra any more.
That’s not nearly as satisfying. But wait! We’re not done. The April 2026 Edinburgh Dance now quicksteps through Scottish Widows, Royal London, Standard Life and Aberdeen.
Life is weird sometimes.
Anyway, a big company bought another one and that’s the sort of thing that happens in late stage capitalism, so we probably shouldn’t be too surprised. Here’s how it works, so pay attention.
Standard Life who were Phoenix bought the Standard Life brand off of Standard Life Aberdeen back in 2018. They had a wee think for a bit, and have now properly rebranded to Standard Life, with the wee pointy bit above the ‘e’ and everything (I was there when the pointy bit came in and I still don’t understand it. Is it “Standard Liffay” or what?). So that’s the first bit.
They’ve gone and bought or at least agreed to buy Aegon UK for £2 billion, which is A Lot. The deal was signed on 15 April. Standard Life pays £750m in cash and issues 181 million new shares to Aegon, which will emerge from the whole thing as a 15.3% shareholder in the enlarged group. Aegon gets a NED board seat and first choice of the really good chocolate biscuits at the meetings, which everyone knows are the ones wrapped in orange foil. Completion is expected around the end of 2026, subject to the usual regulatory faffing.
We’re up to date. So what about all that? Well, Andy Briggs from Standard Liffay says that the deal “significantly accelerates” its push to be the UK’s leading workplace and retail investments provider by asset count. He’s sort of right – £160bn turns up with Aegon, and that gives the new combined group £480bn, putting it firmly in contention with Aviva, who is probably biggest. But a lot of that asset is closed book run-off stuff, so the two businesses aren’t like for like.
The man with my favourite name in financial services, Lard Friese at Aegon, says that SL is “the right owner” and he will be enormously relieved to hear I think he’s right. “It’s alright Lard! Mark says you’re all good.” “Thank **** for that!” says Lard, effortlessly pronouncing a row of asterisks. (Apologies to Pratchett for that gag).
Why? Well, say what you like about Phoenix/SL, but it knows how to run at scale and while I know most advisers have had super negative experiences with closed book servicing, that sort of comes with the territory and let me tell you there are much, much worse places for run-off to happen than now-SL. That’s going to be useful. It knows how to unpick difficult stuff so it can make money, and I think if we’re honest the platform formerly known as Cofunds still needs some of that. There’s a better chance of that happening under new management than where it was, where a decade of effort still hasn’t got TAP where it needs to be.
There is enough institutional memory inside now-SL to be able to assimilate the very healthy workplace business, and observers of the Edinburgh Dance will know that some SL staff will be <very> familiar with elements of the Aegon book. It feels like that should land well, and that will be hugely important.
But the main thing is that SL needs an open-book business. It’s got the brand; it’s got the muscle. But building back up is hard. The workplace book will be a huge energy-injector (is that a thing?) and even the platform business, as difficult as it’s been, will be a very welcome addition.
Your music choice comes from my Utrecht sojourn. Please enjoy the majesty of Earth to Sky by Danish/Faroese legends Iotunn.
See you next week
Mark
