CVC et al. re-up in Pension Insurance Corp via £750m capital raise

Greg Gille
14 February 2020

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The existing shareholders of Pension Insurance Corporation (PIC), a UK-based specialist insurer of defined benefit pension schemes, have provided the business with a ТЃ750m round of funding.

Reinet Fund, a specialised investment fund incorporated in Luxembourg and PIC's largest shareholder, invested £437.8m to end up with a 46.4% stake in the group. Luxinva, a wholly owned subsidiary of Abu Dhabi Investment Authority (Adia), invested £171.6m and now has an 18.2% shareholding. CVC Strategic Opportunities I deployed £130.6m for a 17.4% shareholding. The majority (60%) of the total funds invested will be available to PIC immediately, with the remaining 40% callable upon request before 26 January 2021.

PIC announced it would aim to raise the fresh equity at the end of January this year.

Previous funding
Global private equity firm JC Flowers was one of the founders of PIC, establishing the company in 2006.

CVC Capital Partners acquired a 10-20% stake in PIC at an enterprise value of around £2bn in February 2017. The GP drew equity from its $4.4bn Strategic Opportunities Fund to back the transaction.

JC Flowers sold a 21.4% stake in the company to the principal investment arm of Adia in 2018. The sale ended a 12-year holding period for JC Flowers. Adia became the second-largest shareholder in the group after the transaction, behind Reinet with a 43.5% holding.

Company
PIC was founded in 2006 and is headquartered in London. The group insures defined benefit pension funds in the UK through pension insurance buyouts and buy-ins.

PIC booked £7.2bn in premiums for 2019, according to its preliminary unaudited results. In 2018 it generated pre-tax profit of £477m based on premiums of £7.1bn.