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Standard Life Aberdeen Extends Partnership With Phoenix; To Sell 'Standard Life' Brand

Standard Life Aberdeen plc (SLA.L) announced Tuesday a simplification and extension of its strategic partnership with Phoenix Group Holdings plc. (PHNX.L).

The strategic asset management partnership, under which Standard Life Aberdeen currently manages around 147.4 billion pounds of Phoenix Group assets, will be extended and will now operate until at least 2031. The key changes relate to the price adjustment mechanism agreed at the time of the Insurance Sale which protects Standard Life Aberdeen in the event of certain types of asset withdrawals.

Further, Standard Life Aberdeen will purchase the Wrap Self-Invested Personal Pension or Wrap SIPP and Wrap Onshore Bond businesses from Phoenix Group. The economic risk and reward in these businesses will transfer to Standard Life Aberdeen with effect from January 1, 2021 with the legal transfer to follow by a Part VII transfer scheme targeted for completion in late 2022.

The company will continue to partner with Phoenix to design and provide investment solutions for Phoenix customers. In addition, it will acquire the UK Trustee Investment Plan or TIP business from Phoenix Group to consolidate its investments offering for UK pension scheme clients.

Standard Life Aberdeen will sell the "Standard Life" brand to Phoenix Group during the course of 2021. As a consequence, certain colleagues who support this brand and related marketing will also transfer to Phoenix Group.

The company will pay 32 million pounds to Phoenix Group in return for Phoenix Group bearing the cost of some transferring colleagues going forward.

Standard Life Aberdeen has initiated a branding review, the outcome of which it will announce later this year.

The upfront payment by Standard Life Aberdeen for the purchase of the Wrap SIPP, onshore bond and TIP businesses will be 62.5 million pounds, which will be offset in part by expected payments from Phoenix Group to Standard Life Aberdeen relating to the profits of the business prior to completion of the legal transfer.

Standard Life Aberdeen's beneficial shareholding in Phoenix Group remains about 14% and it retains the right to appoint a director to the Phoenix Group board.

Given the strength of the partnership that is being created to focus on growth, Standard Life Aberdeen continues to view its shareholding in Phoenix Group as strategic.

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