Interactive Investor to be sold to Abrdn for £1.5 billion

Interactive Investor to be sold to Abrdn for £1.5bn: 400,000-customer DIY investment platform to be acquired by fund giant

DIY investment platform Interactive Investor will be bought by British fund management giant Abrdn in a deal worth £1.49 billion, both companies have confirmed.

Interactive Investor, which has 400,000 customers and is widely regarded as the biggest challenger to the do-it-yourself investment leader Hargreaves Lansdown, will operate within Abrdn as a standalone company and brand.

After weeks of speculation about a deal, each company’s board of directors said Abrdn would buy 100 percent of II’s share capital, including that of majority shareholder JC Flowers.

After weeks of speculation, the deal is finally in

Chief executive Richard Wilson remains at the helm of II, following the move that puts an end to long-standing plans to list the platform on the stock exchange.

The platform praised the deal as driving the next phase of growth, backed by the “strength and depth of Abrdn’s advisory, research and asset management capabilities.”

Clients are likely to see little immediate change in Interactive Investor’s offerings, but DIY investment experts had wondered whether a deal would bring Abrdn’s funds and trusts to the fore.

It marks a significant step for Abrdn under CEO Stephen Bird’s mandate, providing the £532 billion asset management distribution capabilities to II’s 400,000 clients, who are collectively investing £55 billion in the platform.

Established investment platforms such as: Interactive Investor, Hargreaves Lansdown, AJ Bell and Fidelity mutual competition and also a strong challenge from robo-advisors, Forefront and emerging investment apps that offer free stock trading, such as: Free trade and Trade 212.

Wilson said: ‘We will have access to Abrdn’s additional capabilities in research, advisory and wealth management services, and we will benefit from being part of one of Europe’s largest investment and asset management companies, with a vision and values ​​closely aligned at ours.

“Our management will remain the same and the same extraordinary team will continue to develop our service and technology while maintaining our subscription pricing, full market choice and the same campaign spirit and editorial independence.”

Abrdn explained that its strategic focus on financial planning and discretionary wealth management will be “transformed” by combining with II’s high-tech model.

It added that the direct investment market has grown at about 15 percent annually and is “expected to continue growing at a similar pace going forward as a result of accelerating demographic and structural market trends.”

Abrdn shares have underperformed since the summer, falling back to a high of nearly 300p

Abrdn shares have underperformed since the summer, falling back to a high of nearly 300p

The deal, which is subject to shareholder and regulatory approval, is expected to close in the second quarter of 2022.

Abrdn shares are currently down 1.8 percent to 234.8 pence.

Abrdn CEO, Bird said: “This is a unique opportunity and a transformative step in realizing our growth strategy. Interactive Investor is the UK’s number one subscription-based investment platform with a strong reputation as a consumer champion.

“Abrdn’s scale, resources and shared vision will enable interactive investor to grow confidently and extend its leadership position in the UK’s attractive savings and wealth market.”

Compare the best DIY investment platforms and stocks and shares Isa

Online investing is simple, cheap and can be done from your computer, tablet or phone at a time and place that suits you.

When it comes to choosing a do-it-yourself investment platform, stocks and shares Isa or a general investment account, the range of options may seem overwhelming.

Each provider has a slightly different offering, charges more or less to trade or hold stocks, and gives access to a different offering of stocks, funds, and mutual funds.

When weighing up the right one for you, it’s important to look at the service it offers, along with handling and transaction fees, plus any other additional costs.

To help you compare investment accounts, we’ve put together the facts and put together a comprehensive guide to choosing the best and cheapest investment account for you.

We highlight the key players in the table below, but encourage you to do your own research and consider the points in our full guide linked here.

>> This is Money’s full guide to the best investment platforms and Isas

Administration costs Cost Notes fund trading Standard Stock, Trust, ETF Trading Regular investing Dividend reinvestment
AJ Bell YouInvest 0.25% Max £3.50 per month for stocks, trusts, ETFs. £1.50 £9.95 £1.50 1% (min £1.50, max £9.95) More details
bestinvest 0.40% Free £7.50 N/A N/A More details
Charles Stanley Direct 0.35% No platform fee on shares on a trade in that month and an annual cap of £240 Free £11.50 N/A N/A More details
Fidelity 0.35% on funds £45 fee up to £7,500. Max £45 per annum for stocks, trusts, ETFs Free £10 Free Money £1.50 Shares, Trusts ETFs £1.50 More details
Hargreaves Lansdown 0.45% Capped at £45 for stocks, trusts, ETFs Free £11.95 £1.50 1% (£1 min, £10 max) More details
Interactive Investor £119.88 as £9.99 per month £7.99 per month back in trade credit £7.99 £7.99 Free £0.99 More details
iWeb € 100 one-time £5 £5 N/A 2%, maximum £5 More details
Free trade Free for standard account £3 month for Isa Freetrade Plus with more investment is £9.99/month incl. Isa fee No money Free N/A N/A More details
Forefront 0.15% Vanguard Funds Only Free Free Vanguard ETFs Only Free N/A More details
(Source: July 2021. Annual administration fee, can be monthly or quarterly)