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Scottish investment house Abrdn has agreed to sell its discretionary fund management arm to a Liechtenstein-based private bank for £140m.

The sale of Abrdn Capital to LGT is expected to complete in the second half of 2023.

The deal will involve the transfer of about £6.1bn in assets under management, and about 140 employees.

The sale does not include Abrdn's managed portfolio service, which is currently part of Abrdn Capital.

The Aberdeen-based company said that part of the business was "better aligned" to its group strategy and would be carved out and retained.

Abrdn chief executive Stephen Bird said the deal represented "an important step forward in our strategy to focus on our high-growth, platform-led businesses".

He added: "Our track record over the past two years shows that where we identify non-core capabilities, we will look to divest and redeploy capital in ways that better align with the interests of our investors, clients and customers."

The business being sold to LGT delivered about £40m in revenue in 2022, and currently serves around 4,000 clients.

The sale announcement came as Abrdn reported a pre-tax loss of £615m for the year ended 31 December.

The company's assets under management fell by 8% to £500bn, while it also reported a further year of net outflows of client funds.

Mr Bird described last year as "one of the toughest investing years in living memory".