UK - Aegon said it expected to close its first pensions buy-out deal by the first quarter of 2007, having recently announced plans to move into the space as of Monday next week.
The company said it would enter into the highly competitive buyout market by offering a "specialist solution" to SMEs alongside its full buyout capability, starting 30 October.
"We have been warming up the market and we are very optimistic," said Aegon spokesperson Lesley McPherson.
Asked when its first deal would likely go through, McPherson explained pension scheme trustees would not be making an instant decision.
However she forecast the first transaction will probably take place "sometime in the first quarter" of 2007.
High cost has been one of the repeated criticism aimed at the buyout market, but McPherson said the new Aegon vehicle would allow employers to make use of a phased funding solution.
"The phased approach enables employers to spread the cost of buyout over a number of years – and reduce the cost impact," she said. "The option to wind down the scheme gradually, avoiding the ‘cliff edge’ of deferred annuity purchase in a conventional buyout, has previously only been available on a bespoke basis to large schemes," she added.
With Goldman Sachs recently adding itself to the buyout vehicle list, together with Paternoster and Synesis Life, the competition has been on the increase. However, despite the talk about a rush of deals, few have actually been announced.
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