The private equity arm of the Abu Dhabi Investment Authority (ADIA), the Middle Eastern sovereign wealth fund, is set to acquire a 21.4 percent stake in the Pension Insurance Corporation Group (PIC), a UK pensions giant.
It will acquire the stake from the funds that are advised by JC Flowers, a private equity investment firm.
ADIA serves as a financial institution that makes investments on behalf of the government of Abu Dhabi. It was advised regarding the deal by Ernst & Young, Credit Suisse, Allen & Overy, and Oliver Wyman.
During the past years, PIC has built itself as a leading investor of bulk annuities. Bulk annuities are insurance that covers liabilities for final salary pension or defined benefit or schemes.
The announcement comes after CVC Capital Partners, the Formula One racing owner, also revealed in 2017 that it was taking a minority stake in the company. Legend Holdings, a Chinese investor, and Reinet, which is based in Luxembourg, are also included in the ranks of the shareholders of PIC.
Last week, Sky News first reported on the news, however, it was confirmed today after the release of a statement from all of the three parties.
The executive director of the Private Equities Department at ADIA, Hamad Shahwan Aldhaheri, stated: “This investment is a further demonstration of our ongoing strategy to seek out principal investments in market-leading businesses with strong management teams. PIC has proven its ability to respond to the growing trend for UK companies to de-risk their defined benefit pension obligations and, as such, has strengthened its position as one of the industry’s leading pension insurance providers.”
Tracy Blackwell, the chief executive of PIC, stated: “We are confident that, together, they will continue to build on the valuable support provided by J.C. Flowers over the past 12 years, and ensure that PIC is ideally placed to meet the increased demand from pension fund trustees.”
The managing director of JC Flowers Europe, Tim Hanford, said he was “delighted” to see PIC begin a new partnership with the Abu Dhabi wealth fund.
He stated: “We are very confident that the company will continue on its successful journey with this new support.”