Standard Life Aberdeen (LON:SLA) has moved to challenge Lloyds Banking Group (LON:LLOY) over its decision to pull out £109 billion of assets under management. The bailed-out lender had agreed to keep the funds with the asset manager for six months following the merger of Standard Life and Aberdeen Asset Management, which was completed in August.
Standard Life Aberdeen’s share price has slipped into the red in today’s session, having given up 0.33 percent to 361.10p as of 10:31 BST. The stock is underperforming the broader UK market, with the benchmark FTSE 100 index having climbed marginally into positive territory and currently standing 0.11 percent higher at 7,575.39 points.
SLA challenges Lloyds’ move
Standard Life Aberdeen announced in a statement this morning that it had informed Lloyds that it did not agree that following the merger of Aberdeen Asset Management and Standard Life Aberdeen the enlarged group was in material competition in the UK with the lender, and therefor did not consider that Lloyds, its Scottish Widows unit or their respective affiliates had the right to terminate the long-term asset management arrangements (IMAs) covering around £109 billion of assets under management.
The bailed-out bank had previously argued that the merger had result in its assets “being managed by a material competitor”.
“The parties are engaging with each other within the framework of the dispute resolution process envisaged in the IMAs,” Standard Life Aberdeen commented in the statement, adding that it would provide a further update at the appropriate time.
Analysts on asset manager
Goldman Sachs reiterated its ‘conviction-buy’ rating on Standard Life Aberdeen at the end of last month, without specifying a price target on the shares. According to MarketBeat, the FTSE 100 group currently has a consensus ‘buy’ rating and an average price target of 469.83p.