Platforms of the future will need to be £60bn or more, an Aegon boss says, as he dismissed the suggestion that the firm paid too much for Cofunds recently.

Aegon announced a £140m takeover of Cofunds in August, saying it would be creating the UK’s largest platform business, having made the purchase from Legal and General.

Mark Till, Aegon’s chief distribution officer, speaking to Financial Planning Today magazine, responded to the suggestion from some commentators that Aegon spent too much.

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He said: “We think the price we’ve paid is very competitive when you look at other recent platform deals and against the business benefits we believe we can deliver.

“It is certainly considerably more effective than seeking to grow organically. We believe that platforms of the future will need to be £60bn+ to be able to deliver the functionality advisers want, give continuity of commitment and have a competitive price.

“This moves us to that position quickly and we want to use that advantage to earn the continued support of advisers and help them grow and manage their businesses.”

He said: “We’ve had very positive feedback from advisers. They’ve reacted well to the promise of investment and enhancements in the platform.”

Aegon began considering the deal a few months before the announcement, he said.

He told FP Today: “Deals of this nature and complexity do take time to complete so we’d been in discussion for some time. As a result both parties have a good understanding of one another’s business and we know what we’re buying.”

What are the plans for Cofunds and what differences will users see in the near future?

Mr Till said: “Cofunds intermediaries and their clients will have their platform functionality enhanced when we upgrade the technology. This will see them able to access some of the features already enjoyed by Aegon users such as a wider investment range including ETFs, Investment Trusts, shares and income guarantees, an integrated pension and paperless, signature free transacting.

“Alongside that users of the Aegon platform will see the technology upgraded to bring some of the benefits enjoyed by Cofunds users, such as pre-funding and enhanced income capability. We are aiming to create a super-platform combining the best of both Cofunds and Aegon. We plan to announce the detail behind the development roadmap when the purchase is completed which is expected to be towards the end of 2016.”

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