CANADA/UK - The Ontario Teachers' Pension Plan (OTPP) has agreed to buy the operator of the UK National Lottery, Camelot, for an estimated £389m (US$577.7m).
The scheme will buy the firm, which has been running the National Lottery since its launch in 1994, from its shareholders, which includes Cadbury and the Royal Mail.
The transaction is subject to approval from the regulator, the National Lottery Commission.
"We are delighted to be involved with such a company which presents a unique, long-term opportunity to earn attractive risk-adjusted returns," said OTPP.
The sale ends a year-long process, which was thought to be monitored closely by UK government ministers because of Camelot's commitment to a £2.2bn funding package for hosting the 2012 Olympic Games in London
It was made by OTPP's long-term equities division, which is focused on direct investments that have steady cash flow and growth potential over a long-term horizon.
The scheme, one of Canada's largest which looks after the benefits of more than a quarter of a million teachers, already has stakes in a number of other UK businesses, including airports Bristol International and Birmingham. (Global Pensions; September 16, 2009)
If the deal is approved, OTPP will inherit Camelot's 10-year licence to run the National Lottery, which came into effect in February last year.
The National Lottery Commission will scrutinise the pension scheme, which had net assets of C$87.4bn (US$85.25) at December 31, 2008, for "fitness and propriety and financial viability".
In addition, the regulator will make sure that the proposals safeguard the commitments to the players of the National Lottery and good causes set out in the license.
This week's edition of Professional Pensions is out now.
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Companies which have tried to dodge their pension duties by changing their identities are being "hunted" by The Pensions Regulator (TPR) in a crackdown on non-compliance with auto-enrolment (AE).
Removing liquidity restrictions would enable DC funds to capitalise on the potentially higher and safer returns that DB schemes have benefitted from, says Patrick Marshall.