DENMARK - Pension fund LD has cut its last ownership ties to LD Invest, selling the 32% stake it had left in the asset management unit to pensions institution PKA, the foundation Realdania and to LD Invest itself.
At the same time, the corporate lending bank FIH sold its LD Invest holding of around 15%. The deals have increased PKA's stake in LD Invest to 22%.
Carsten Koch, director at LD, said: "From the start, it was quite a task to carry out the purely practical separation of the two organisations. We are incredibly pleased that the last economic and legal division of property has fallen into place."
This is the final stage in LD's gradual separation from the subsidiary it set up in 2005. Because LD is now only one of many LD Invest clients, remaining an owner is no longer appropriate, it said.
LD originally created LD Invest to conduct its investment activities on a commercial basis. At that point, LD held the majority share via a holding company. Other shareholders were FIH, along with staff and management.
Back in 2009, Koch took over from Jeppe Christiansen as director of LD, leaving Christiansen free to spend more time in his role as director in LD Invest. Then in June 2010, LD and FIH reduced their stakes in the holding company by selling shares to PKA and PBU.
Christiansen said the change of ownership was a milestone in the asset management company's history.
"We founded LD Invest in 2005 and have worked since then toward this day when the two organisations each stand strengthened and independent of each other," he said.
PKA, which manages eight pension funds in Denmark with combined assets of DKK122bn (€16.4bn), has raised its stake in LD Invest "significantly", LD Invest said.
Peter Damgaard Jensen, PKA's managing director, said: "PKA invested in LD Invest for the first time in the summer of 2010. We know them really well and have cooperated in a number of fields. So when the opportunity to invest more came up, it didn't take us long to consider. It is quite simply a good investment for us."
Last year when LD Invest's contract with LD was about to end, LD put its asset management out to EU tender. LD Invest pointed out that it won three out of the 12 mandates in this process, amid strong international competition.
This meant LD was now one customer among around 70 other big clients, which LD Invest has won with an active growth strategy, it said.
"We have a long-term growth strategy with a focus on standing as an independent and technically strong organisation," Christiansen said.
The parties involved in the deal agreed not to disclose the amounts paid.
LD, or Lønmodtagernes Dyrtidsfond, is a supplementary lump-sum pension scheme covering employees who were working at the end of the 1970s. It had DKK54.6bn of assets under management at the end of 2010.