Investment firm Cardano has agreed to acquire workplace pension provider Now: Pensions for an undisclosed sum.
The deal, announced today (February 13), is expected to be completed later in 2019 after the master trust, which has more than 1.7 million members, receives green light from The Pensions Regulator (TPR) as part of its ongoing authorisation process.
Now: Pensions, currently owned by Danish pension fund ATP, recently announced it has resolved its historic administrative issues with the regulator.
A year ago, the provider received a £70,000 fine from the watchdog due to problems with collecting contributions, and its failure to communicate these problems to members.
Cardano said the acquisition would bring together the group’s investment skills and experience in the defined benefit and defined contribution markets with Now: Pensions’ auto-enrolment platform and administration capabilities.
Founded in the Netherlands in 2000 Cardano already provides services in risk management, investment management, research, actuarial, investment advice, and fiduciary management.
Following completion of the deal, the group will manage more than £25bn of assets and employ 350 people across its core markets in the UK and the Netherlands.
This was Cardano’s second deal in the UK, following the acquisition of covenant advisory specialist Lincoln Pensions in October 2016.
Theo Kocken and Michaël De Lathauwer, co-chief executives of Cardano, said: "Bringing Cardano and Now: Pensions together is transformational for our group. It is an investment in the future of UK pensions, enabling us to grow and diversify our client base.
"We believe our combination of pensions risk management and investment skills, together with Now: Pensions’ enormous potential creates a ‘new force’ across the UK pensions landscape."
Troy Clutterbuck, CEO of the master trust, said Cardano was a "like-minded organisation, with a long-term commitment to the UK pensions market", that offered a great fit with Now: Pensions.
He added: "Workplace pensions in the UK are gathering greater momentum as the auto-enrolment regime matures. Being part of the Cardano Group will bring significant benefits for our clients and members, giving us a fantastic platform to reach our full potential."
Bo Foged, interim CEO of ATP, said the market had matured and the master trust would now be entering a new phase of operation focused on asset growth.
He said: "In view of ATP’s continued strategic focus on simplification and consolidation, we have found this to be the right time to exit the investment and sell the company to a new and dedicated owner who will take the company into the next phase of development in the UK market."
In April 2016 the pensions regulator found that the pension contributions of almost one in three of Now: Pensions' members – an estimated £18m affecting over 265,000 people – had not been collected, and there were ongoing problems both with the collection of contributions and with ensuring the correct amounts were invested for members.