NETHERLANDS - Financial services giant, ING Groep has signed a letter of intent to acquire Limburg-based pensions provider AZL for €65m, less than 1% of the firm's assets under management.

ING announced the move this morning, saying: "The proposed transaction will have no material impact on the capital adequacy ratios of ING Group."

AZL manages approximately €8bn on behalf of 58 pension funds and other institutions that provide retirement benefits to approximately 455,000 people. It employs 350 staff.

It is the latest in a spate of mergers and alliances in the Dutch pensions market. Last autumn Mn Services and Cordares, the managing companies for the metalworkers and builders' schemes, announced a joint venture to seek third-party business.

"This is the perfect deal for us," said Huub Dumont, chief executive officer of AZL, who divulged that his company had gone looking for a new owner. He added that he was very satisfied with the proposed takeover price and was adamant that key staff would remain in place.

These include Rob ten Wolde, former head of the corporate pension fund association, and Walther Schapendonk, former chief investment officer of the Progress Fund and AZL's current director of investment services.

ING will merge AZL with its pension services division, though the combination will continue under the name AZL.

The AZL acquisition is pending regulatory approval and ING hopes to complete it before the end of the second quarter of this year.

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