Comment: Schemes have every right to be cautious about Watson Wyatt / Towers Perrin deal

What I mean is, there must be a large cohort of pension funds out there that ended last year with one set of service providers and now, through no action of their own, find new entities looking after core aspects of their service provision.

First off the blocks came Credit Suisse's asset management business's acquisition by the deal hungry Aberdeen Asset Management. Then we had a pause while Mercer and Callan decided they did not actually want to merge. Then, out of the blue, Capita Hartshead snapped up Gissings.

This was followed by the mega BlackRock/BGI tie in, with some pension funds suddenly finding their two biggest managers were soon to become their single biggest manager. And now we have the Watson Wyatt/ Towers Perrin unity.

There are, of course, different drivers for these deals. BGI and BlackRock has been called a meeting of minds, while the sale of Credit Suisse's asset management arm falls under the category of opportunistic. Towers Watson, meanwhile, is about creating the biggest consultancy in the world and a one-stop-shop for clients.

We are also usually told these deals are driven by the cost savings that can come with scale. But let's be honest, there must also be a degree of empire building when it comes to these things. How better to cement your reputation than to build the biggest consultant or money manager on the planet? And could the threat of the Callan/Mercer tie up have spurred Watsons and Towers into wedlock, for fear that they could have been the last firm left without a partner at the dance?

The ramifications of the BlackRock/BGI deal have been widely discussed, not least by the consulting community. But what about when consultants merge? When money managers merge it is normal for consultants to put them on a watch list. Will key personnel leave? Will the culture change? How will star performers be tied in?

In fact, clients can be told to hold off assigning mandates. So, is the biggest consultant in the world now officially on a watch list?

I have no doubt that all the individuals in each organisation are exactly as intelligent and capable as they were before they were informed of their forced marriage.

And arguably there is nothing quite like the threat of competition from new colleagues to motivate those who have slipped into the comfort zone. But at the end of the day either a new company culture must be formed or one culture will dominate the other. There can be no status quo.

And let's not forget that things don't always go according to plan. Sitting here as an inadvertent shareholder of RBS and the rump of what was once ABN AMRO, I am slightly cautious of empire builders.

Generally you choose one service provider over another for a reason, and therefore when that changes you have a right to be suspicious. The problem now is that you have fewer providers from which to choose.