NETHERLANDS – PGGM, the pension fund manager for the Dutch healthcare industry, is holding exclusive talks to acquire A&O Services before the end of this year.

A&O is the pension fund management organisation serving the €5bn industry-wide house painters scheme, as well as several other smaller schemes.

A&O Services has been operating as the pensions manager for the Dutch house painting, finishing, plastering and maintenance industry for some 60 years.

More recently, the manager also took on the pension management for ship maintenance and industrial cleaning businesses, as well as the corporate scheme of Deloitte.

PGGM and A&O are in exclusive talks to hammer out the "contours of the acquisition", according to a joint statement.

The deal would include management of pensions and employee benefit schemes to be transferred to PGGM.

Both parties have indicated they expect a deal to be finalised before the end of this year.

A&O is opting for acquisition by its much larger peer to "safeguard the continuity in the long term" of retirement schemes within its home industries of house painting and finishing.

In the Netherlands, the construction business and related industries have been hit especially hard by the crisis, and this is an explicit consideration for A&O, the manager said.

PGGM, in its turn, hopes to achieve a "further concentration of knowledge, expertise and size".

The manager believes this will help ensure a sustainable Dutch pension system.

Already, PGGM is the second-largest pension fund manager in the Netherlands, running more than €134bn for five pension schemes – including the industry-wide schemes for the Dutch healthcare industry and security services industry, and the professional schemes for general practitioners, independent artists and architects.