EUROPE – Pension Fennia and Tapiola Pension, two of the largest pension providers in Finland, have signed a letter of intent to merge, creating a new company with more than €17bn in assets.
The two parties said they would focus on improving the overall efficiency of the management of earnings-related pensions and establishing a "strong and responsible" occupational pensions player in "a challenging and changing operating environment".
The new company will offer earnings-related pension insurance services to all private sector enterprises and self-employed persons.
The new entity will continue to cooperate closely with the Local-Tapiola Group and Fennia Group, two of the largest insurance groups in the country, acting as the earnings-related pension insurance partner for both groups of companies.
The parties aim to prepare a merger plan that will be handled by the administrative bodies of the companies by 31 May.
According to the letter of intent, the merged company will start operations on 1 January 2014.
In other news, AP6, one of the Swedish national buffer funds, has together with Ratos, one of the largest private equity groups in Europe, and Ferd, the Norwegian industrial and financial group, signed a deal to purchase all the shares in Aibel, a Norwegian offshore service company, for a total value of SEK10bn (€1.2bn).
AP6 will own 18% of Aibel, Ratos 32% and Ferd 50%.
In a statement, Karl Swartling, chief executive at AP6, said the investment was an "exciting opportunity" for good long-term returns.
"Aibel is a leading company with long industrial experience in an expansive sector with good growth prospects," he said.
Aibel is a Norwegian service company within the oil, gas and renewable energy sector.
The company employs some 8,000 people and has operations along the Norwegian coast, as well as in Asia.
The deal is expected to be finalised during the first quarter, pending regulator approval.
Meanwhile, AP4, one of the Swedish national buffer funds, has established a 'green' equity mandate to invest in listed US companies responsible for low greenhouse emissions.
In its latest annual report on corporate governance, AP4 says it expects the sector to develop rapidly and that, with a functioning market and pricing of emissions, companies that have lower emissions than their competitors may gain financial advantages.
AP4 has developed the mandate together with BlackRock.
Lastly, privately employed professionals have paid some SEK4.7bn in unnecessarily high pension fees over a 10-year period, according to a study by Collectum.
The administrator for white-collar occupational pensions urged members to change providers to those with lower fees, arguing that a percentage point in lower fees could result in a 25% increase in future pension.
According to Collectum's calculations, there is still SEK64bn of pension assets in old insurance products with unnecessarily high fees, resulting in SEK4.7bn in "overpaid" fees.