Pension Insurance Corporation (PIC), the specialist bulk annuity provider, has been acquired by European insurance giant Athora in a deal worth an estimated £5.7bn.
It will become the UK insurance business for Athora, which has existing presences in Belgium, Germany, Italy and the Netherlands.
The acquisition is a significant boost for Athora as it will increase its assets under management and administration to more than €130bn (£112bn). At the end of 2024, PIC was responsible for almost £51bn of assets and paid pensions to more than 400,000 people.
In a statement announcing the deal, PIC said its new ownership would boost its ability to invest in UK housing and infrastructure, areas in which it has already allocated significant capital.
The transaction is subject to regulatory approval and is expected to complete early next year.
Tracy Blackwell, PIC’s chief executive officer, said: “Athora’s investment is validation of what we have always believed: that PIC’s reputation, strategy, fortress balance sheet, purpose, and most importantly our people combine to make this a unique business in a huge and growing market.
“With Athora backing us through our next phase of growth as their UK insurance business, we will be able to provide more options to the trustees of defined benefit pension schemes and invest more in UK housing and infrastructure.
“This acquisition and the potential for growth that it represents is the strongest possible recognition of the value and importance of the pension risk transfer market, the sector that PIC helped to create and continues to lead.”
Tracy Blackwell, Pension Insurance Corporation
“The pension risk transfer market is vital to the wellbeing of millions of UK pensioners and the allocation of tens of billions of pounds of investment into the UK’s economy. This acquisition and the potential for growth that it represents is the strongest possible recognition of the value and importance of the pension risk transfer market, the sector that PIC helped to create and continues to lead.”
Athora chief executive officer Mike Wells added: “As our UK subsidiary, PIC will be the largest business within the Athora Group and we intend to invest in the business and its people to support that growth in the UK pension risk transfer market. We have great confidence in the long-term strengths of the UK: its retirement market, regulatory and policy framework, and economic prospects.”
Sovereign wealth fund takes long-term position on UK bulk annuity market
Athora will take full control of PIC from the bulk annuity provider’s existing shareholders. These include Luxembourg-based investment firm Reinet, as well as private markets investors CVC Capital Partners and HPS Investment Partners.
PIC is also part-owned by a subsidiary of the Abu Dhabi Investment Authority (ADIA). The sovereign wealth fund stands to retain an indirect interest in PIC as it is also an investor in Athora. Apollo Global Management is the other major investor in Athora.
Hamad Shahwan Aldhaheri, executive director of the private equities department at ADIA, said: “As a shareholder in PIC since 2018, our investment supported the growth of the company as it strengthened its position as one of the leading players in the UK pension risk transfer market.
“Following this transaction, we will maintain exposure to the company via our existing shareholding in Athora, and believe that PIC has strong prospects for the future. We wish the company continued success as part of Athora.”
Charlie Finch, partner at consultancy group LCP, said the deal was a “big vote of confidence in the UK pension risk transfer market”.
“In the past two years, four insurers have entered the market, including… Brookfield setting up the first new insurer in the market for over 15 years,” he said.
“The seven other established insurers have all increased their appetite and capacity, and market volumes have grown substantially, with nearly £50bn being transferred from UK defined benefit pension schemes to insurers in each of the past two years. Athora states that it wants to invest in PIC to support the growth in the UK pension risk transfer market.”
