Standard Life to sell Standard Life Bank to Barclays Bank

Standard Life Plc has entered into an agreement to sell its wholly-owned UK mortgage and savings business Standard Life Bank Plc to Barclays Bank PLC for a consideration of GBP226 million in cash.

Both Barclays and Standard Life are UK-based financial service providers.

Under the terms of the transaction, Barclays will acquire a savings book of approximately GBP5,500 million, as at June 30, 2009, and a mortgage book with outstanding balances of approximately GBP8,800 million, as at June 30, 2009, with an average indexed loan to value ratio of 48% at that date.

Separately, Standard Life and Barclays UK retail banking have agreed heads of terms to enter into a strategic agreement to explore joint opportunities in the UK retail long-term savings and investments sector. The initial focus is expected to be on the development of a simplified pension product. Thereafter, both parties will continue to explore and develop further opportunities in this market.

Following the completion, approximately 270 Standard Life employees will transfer to Barclays. The transaction is expected to occur in the first quarter of 2010.

Rumor (September 28, 2009):

According to Hemscott, The Times reported that Barclays is planning to acquire the banking division of Standard Life.

The transaction is valued at approximately between GBP200 million and GBP300 million.

Merrill Lynch & Co., Inc. is acting as sole financial advisor to Standard Life in connection with the transaction. Merrill Lynch & Co., Inc. and UBS are acting as joint corporate brokers. Brunswick Group LLP is acting as PR advisor to Barclays Bank.

Deal Value (US$ Million) 368.58
Deal Type                Acquisition
Sub-Category             Majority Acquisition
Deal Status              Announced: 2009-10-26

Deal Participants

Target (Company)   Standard Life Bank Plc
Acquirer (Company) Barclays Bank PLC
Vendor (Company)   Standard Life plc

Deal Rationale

The acquisition of Standard Life Bank is a good fit with Barclays existing UK retail banking business.

Related terms: acquisition, advisor, bank, banking, book, business, market, mortgage, retail