UK-based banking and financial services company Virgin Money has agreed to acquire investment company abrdn’s 50% interest in Virgin Money Investments.

Virgin Money Investments is a joint venture (JV) established between Virgin Money and abrdn in 2019. The JV combined the capabilities of both companies to develop a new proposition for retail investors.

According to the terms of the deal, Virgin Money will purchase abrdn’s stake in Virgin Money Unit Trust Managers, the entity which holds Virgin Money Investments, for a cash consideration of £20m.

Virgin Money aims to finance the acquisition entirely from the company’s existing capital resources.

The buyout offer has come following the successful launches of Virgin Money Investments’ new investment and pension services for customers.

The JV launched a new service, including both a new digital platform and a range of investment products in April 2023. It also introduced a new pension on the platform in November 2023.

Besides, all existing investment and pension accounts held on the old platform of Virgin Money Investments were migrated to the new platform last month. 

Virgin Money Investments had total assets under management of approximately £3.7bn and more than 150k customer accounts on 31 December 2023.

Virgin Money aims to double the assets under management for the JV within the next five years.

Upon the completion of the proposed acquisition, abrdn will continue to provide investment advice for Virgin Money Investments.

Virgin Money business and commercial managing director Allegra Patrizi said: “Our joint venture with abrdn has successfully delivered a new investment service offering simple and straightforward investment options for customers.

“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, enabling us to help more customers feel confident to invest for the future and driving significant growth in assets under management.”

Subject to customary approvals, the transaction is expected to be completed in April 2024.