Virgin Money is to take full control of its digital wealth management platform, buying out joint investor abrdn for £20 million.
Launched in April last year, the direct-to-consumer (D2C) platform provides both first time and experienced investors with online and mobile access to a range of three investment funds to choose from, within an ISA or GIA. The business has since added a pension product for users to save from just £25 a month and shift existing pensions to the platform.
At the end of last year, Virgin Money Investments was managing about £3.7 billion worth of assets and more than 150,000 customer accounts.
Allegra Patrizi, managing director for business and commercial at the bank, states: “Taking full control of Virgin Money Investments will mean we can bring the investments and pensions business together with our deposits, mortgages, credit cards and daily banking.”
She says the bank’s ambition is to double the number of assets under management within the next five years.
The proposal is for all existing staff in Virgin Money Investments to move into Virgin Money, with no anticipated job losses.
For abrdn, the buy out price results in a loss of 60% on the value of its original £50 million stake in the joint venture. The firm will continue to provide investment management services to the business.
The deal follows abrdn’s recent announcement that it intends to cut 500 jobs in a bid to save £150 million from its annual costs and make its business more profitable.
A spokesperson for abrdn says: “Following our acquisition of interactive investor and ongoing efforts to streamline the business we have concluded that the joint venture with Virgin Money no longer aligns with our strategy.
