Closed life and pension fund consolidator Phoenix Group Holdings plc, owner of the “old” Edinburgh-based Standard Life Assurance, said on Thursday it is involved in “disagreements” over fees with Standard Life Aberdeen that could result in legal proceedings.

Analysts believe the dispute is over the level of fees charged to Phoenix by Standard Life Aberdeen for managing and selling Phoenix products.

The news of the dispute came as Phoenix Group published results for the six months ended June 30, 2020, showing operating profit rose to £361 million from £325 million at the same stage last year and assets under administration unchanged at £248 billion.

Standard Life Aberdeen sold Standard Life Assurance Limited to Phoenix Group Holdings for £3.28 billion two years ago.

The deal comprised of £2.28 billion cash and a shareholding of 19.98% for Standard Life Aberdeen in the enlarged Phoenix Group.

As part of the deal, Standard Life Aberdeen and Phoenix agreed to expand their existing strategic partnership.

Standard Life Aberdeen plc and “affiliated investment management entities” still own 24.84% of Phoenix.

Phoenix Group said: “The group is currently engaged in ongoing discussions with members of the Standard Life Aberdeen group in respect of disagreements over the operation of certain aspects of the SLA share purchase agreement relating to services and expenses, and the scope and cost of services provided …

“Whilst Phoenix and Standard Life Aberdeen are currently seeking a commercial resolution in respect of such disagreements, it is possible that all or some of these matters could be escalated to a dispute resolution process provided for in the relevant agreements, or result in legal or arbitration proceedings.

“There is no certainty as to how the current disagreements will be resolved and the extent to which an outflow of resources will be required to settle any obligation, should it arise.”