FOR Keith Skeoch, it was a notable scalp to claim so early in his days as top dog of Standard Life Aberdeen (SLA).
A week after becoming the sole chief executive of the Edinburgh institution, Mr Skeoch was savouring victory over Lloyds Banking Group following a long-running dispute over a key fund management contract.
The row erupted in February of last year when Lloyds, through its Scottish Widows business, said it was pulling the plug on SLA’s mandate to manage £109 billion of its customers funds. The mandate was a legacy of Aberdeen Asset Management’s acquisition of Scottish Widows Investment Partnership, the asset management arm of Scottish Widows, in 2014. But Widows triggered a review after Aberdeen Asset Management and Standard Life merged in 2017, leading it conclude that its assets were now being managed by a “material competitor”.
In February 2018 Widows served SLA notice of its intention to terminate the deal in 12 months, but the investment firm fought back, with a tribunal upholding its position that Lloyds had not been entitled to give notice to rip up the deal.
Attention now moves to what happens next. Will SLA pursue compensation? Or will it see out the contract, which is due to expire in 2022? Lloyds also has decisions to make. Having lined up BlackRock and Schroders to take over the funds, it must decide whether to negotiate an end to the mandate with SLA now, or sit tight until 2022. One suspects there will be more to come.
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