Aberdeen Asset Management is set to buy the institutional business of rival Edinburgh Fund Managers for the bargain-basement price of £3m (€4.3m), once it has sold on EFM's retail business to New Star Asset Management.

Aberdeen has made an all share offer valuing EFM at roughly £36m, and will then sell on the management rights of EFM's retail funds to New Star for £33m. Of this sum, £27m will be paid in cash and £6m in New Star shares when the sale is completed.