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BlackRock Wins $40 Billion Chunk of Lloyds Investment Pile

Ross Larsen
BlackRock Wins $40 Billion Chunk of Lloyds Investment Pile

(Bloomberg) -- BlackRock Inc. won a mandate to manage 30 billion pounds ($40 billion) of assets for Lloyds Banking Group Plc, the latest twist in a hotly contested battle to win a slice of 109 billion pounds that Schroders Plc is also vying for.

Key Takeaways

Statement from Lloyds suggests more collaboration to come with the world’s biggest money manager, whose products run the gamut from alternative investments to risk management systems for managing assets.Deal means the Scottish Widows assets that had been overseen by Aberdeen Asset Management will be handed over to more than one manager.Schroders had been considered the front-runner to win the mandate. It remains to be seen how the remainder of the assets will be distributed. Lloyds confirmed talks with Schroders in a deal that may include wealth management.

Digging Deeper

BlackRock was selected after a competitive tender process, Lloyds says. Group is near to finalizing arrangements with respect to the remaining 80 billion pounds of assets.Lloyds decided to take the mandate away from Aberdeen after it merged with Standard Life Plc, citing competition concerns.Standard Life Aberdeen is still challenging Lloyds’ decision to cancel the contract in an arbitration tribunal. Lloyds said it expects that process to end early next year.While the $40 billion is a fraction of BlackRock’s massive $6.3 trillion under management, the rest of the mandate would represent a significant boost to Schroders, which oversaw about 447 billion pounds at the end of last year.

Market Reaction

Schroders fell 4.1 percent to the lowest level since December 2016 on Thursday. The shares gained less than 1 percent Friday.

(Adds arbitration process, assets under management in Digging Deeper section.)

To contact the reporter on this story: Ross Larsen in Rome at rlarsen2@bloomberg.net

To contact the editors responsible for this story: Sree Vidya Bhaktavatsalam at sbhaktavatsa@bloomberg.net, Andrew Blackman, Geoffrey Smith

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