Goldman Plans Takeover of Troubled UK Pensions Insurer Paternoster

Paternoster, set up in 2006 to buy up defined benefit pension schemes from companies seeking to offload their risk, is expected to complete a takeover deal within the next couple of months.

(November 1, 2010) — Goldman Sachs is plotting a £300 million ($482 million) takeover of deal to buy Paternoster, a UK-based pension insurance company.

The investment bank is reportedly forming a bid to merge its existing pensions buyout business, Rothesday Life, with Paternoster, according to City AM. To advise the deal, Paternoster has appointed insurance broker Willis Group. Goldman Sachs declined to comment.

Paternoster, which manages pensions for 44,000 pensioners in the UK, totaling £3.3 billion ($5.3 billion) in assets under management, has been up for sale since August. Its original backers, including private equity fund Eton Park — the hedge fund founded and ran by Goldman’s youngest partner, Eric Mindich — are facing steep losses of over half their original £500 million ($803 million) investment, City AM reported.

The Pension Corporation is thought to be another potential buyer of Paternoster, along with a number of private equity and trade buyers.

To contact the <em>aiCIO</em> editor of this story: Paula Vasan at <a href=''></a>; 646-308-2742