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M&A Transaction•

Apollo-Backed Athora Buys PIC for £5.7B in UK Pension Deal - InforCapital

Athora acquires Pension Insurance Corporation for £5.7B, marking its biggest move into the UK’s £2tn pension market.

AM
Alvaro de la Maza

Partner at Aninver

Key Takeaways

  • Apollo Global Management acquired HPS Investment Partners, Abu Dhabi Investment Authority – ADIA, CVC Capital Partners for $7.3B.
  • Sector: Financial Services & Fintech.
  • Geography: United Kingdom.

Analysis

Athora, the European insurance group backed by Apollo Global Management, has agreed to acquire the UK-based Pension Insurance Corporation (PIC) in a landmark £5.7 billion ($7.3 billion) transaction. The deal represents Athora’s largest acquisition to date and significantly expands its footprint in the UK pension market, which holds over £2 trillion ($2.56 trillion) in retirement savings.

PIC, with approximately £50 billion ($64 billion) in assets under management and a customer base of nearly 400,000 policyholders, will become Athora’s largest subsidiary. Despite the acquisition, PIC will continue operating independently under its current brand, maintaining continuity for clients and business partners.

Athora is acquiring PIC from a high-profile investor consortium that includes CVC Capital Partners, Reinet Investments, the Abu Dhabi Investment Authority (ADIA), and HPS Investment Partners. These firms played a critical role in PIC’s growth trajectory, with Reinet’s initial £400 million ($510 million) investment in 2012 growing nearly ninefold, and CVC’s 2017 investment tripling in value.

The acquisition not only underscores Athora’s ambitions in pension risk transfer (PRT) but also demonstrates Apollo’s ongoing expansion in UK financial services. Apollo has recently participated in a £4.5 billion ($5.76 billion) financing commitment to EDF for the Hinkley Point C nuclear project and acquired Restaurant Group, the owner of the Wagamama restaurant chain.

PIC has become a market leader in the bulk annuity and pension buyout space, securing some of the largest corporate pension de-risking deals in UK history. Among its most notable transactions is the £6.5 billion ($8.3 billion) pension risk transfer with RSA Insurance Group in 2023, the largest of its kind in the UK.

The deal has been years in the making and comes amid a broader wave of private capital investment in the UK insurance sector. Firms such as KKR and Carlyle are also reportedly exploring opportunities in this area, reflecting growing confidence in the long-term profitability of the retirement and insurance industries.

Tracy Blackwell, CEO of PIC, stated, “PIC has had an amazing growth story over the past two decades and is now one of Britain’s pre-eminent pension businesses.”

Mike Wells, CEO of Athora, 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.”