Standard Life chief defends £11bn merger 

Standard Life
£11bn deal with Aberdeen made for long-term reasons says chief executive Skeoch Credit: Alamy 

Standard Life chief Keith Skeoch has defended the insurer’s decision to merge with rival Aberdeen Asset Management, in his first interview since the £11bn deal was agreed.

The tie-up has raised  concerns over likely job cuts, the management structure of the combined company, and possible asset outflows.

In an exclusive interview with The Sunday Telegraph, Mr Skeoch admitted that big tie-ups come with short-term risk and issues, but insisted: “We’re not doing this for short-term reasons.

“My own view is that over the next 10 to 15 years, the big winners in asset management will have scale,” he said.

However, his enthusiasm is not shared by everyone internally, with sources claiming that some Standard Life fund managers have voiced fears that they were being “sold down the river to Aberdeen”, the smaller of the two.

David Cumming, head of equities at Standard Life Investments, quit two days after the merger was revealed.

Mr Skeoch, chief executive of Standard Life since August 2015, refused to comment on whether some divisions of the combined firm might mirror the co-chief executive structure that will see him run the company in tandem with his Aberdeen counterpart, Martin Gilbert.

“Martin’s strength is looking externally, at clients, at marketing, I’m an investment guy,” he said, defending the fact that the long-time friends are sharing the top job, a question he said was for the chairman.

“There’s an awful lot to do, and an awful lot to go around, and in that respect this isn’t just about two individuals,” he said. “When we had the meetings with the management teams to see if this would work, those teams got on.”

Rival firms are already eyeing opportunities to poach employees from both companies, with chief executives sending out internal recruiters to tap up staff at Standard Life and Aberdeen.

Mr Skeoch said Standard Life has long-term incentives and has made sure the “key senior people” agree that this is the right thing to do. “We have always been a team, and that means we share a lot, talk a lot, so I have made sure key senior people are aligned with me,” he insisted. “Our people are pretty focused on the opportunity that this brings.”

However, he played down suggestions that the deal could fall apart: “Never say never, but it’s very unusual for a deal of this nature to fall over.” He said he was currently checking that the name of the new business “doesn’t mean something silly in Swahili or Finnish” before it gets the go-ahead.

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