Pension Corp in new fund-raising

Pension Corporation, a specialist UK pension manager, is seeking to raise about £400m (US$602m) in a second round of fund raising and has received an ‘immediate’ investment from JP Morgan representing about 15%of that total.

The company, led by financier Edmund Truell, offers pension buyouts, longevity insurance, pension fund sponsorship and asset liability management.

The new investment comes as part of an agreement to acquire Synesis Life, the UK insurer of bulk annuities backed by JP Morgan, Royal Bank of Scotland and Warburg Pincus.

“The fundraising will be offered first to current investors and thereafter will be marketed to new investors in the first half of 2009,” the company said in a statement.

Pension Corp said it is launching the fundraising “to meet the fast-growing pipeline of pension enquiries, which now exceed £100bn across the group’s range of solutions”.

The company, which has written business for about £5 bn of pension assets since launching in 2006, said it has provided quotes on about £40bn worth of pension assets.

Truell told reporters in a conference call on Tuesday that he had already received ‘strong indications’ from existing investors ahead of the fund raising, which will be carried out at a premium to the original raising.

Pension Corp’s existing investors include RBS, HBOS, Swiss Re, JC Flowers and Och-Ziff among others. The majority of the firm’s management also hold stakes.

Truell said the deal to bring on board Synesis Life staff represented the start of a period of consolidation in the pensions insurance market, ‘that we think will continue in the months to come.’

‘We see relatively few winners in the pension market, ‘ he said.

Synesis Life had not written any business since launching more than two years ago. In buying the firm, Pension Corp is effectively hiring the staff, who are already in situ at Pension Corp’s offices after moving in the summer.