LONDON, March 20 (Reuters) - Virgin Money and Aberdeen Standard Investments (ASI) are forming a joint venture to provide asset management services to customers of the British challenger bank, the two firms said on Tuesday.
ASI, the asset management arm of Standard Life Aberdeen (SLA), will buy 50 percent of Virgin Money Unit Trust Managers for an upfront payment of 40 million pounds ($56.24 million), with the deal due to complete at the end of 2018, the firms said in a statement.
Virgin Money has 200,000 customers and 3.7 billion pounds in assets under management.
Jayne-Anne Ghadia, chief executive of Virgin Money, said the deal would “generate significant growth in assets under management, drive additional capital-light returns and...be game-changing for our investment business over the longer term.”
Insurers and asset managers are seeking distribution deals with banks to extend their customer base. Aviva agreed a 10-year general insurance distribution deal with HSBC last year.
Lloyds Banking Group pulled 109 billion pounds in investments from SLA last month.
$1 = 0.7113 pounds Reporting by Carolyn Cohn, editing by Sinead Cruise