UK - Goldman Sachs has bought Paternoster for £260m ($407m) but will not immediately combine the firm with its Rothesay Life subsidiary.
In a statement this morning, Goldman Sachs said it had bought all the shares in Rothesay Life following an "extensive" sale process.
However it said Rothesay Life, its existing insurance subsidiary, and Paternoster would be held as separate insurance companies in the short term - but noted there was an intention to combine the two over time subject to regulation.
It said policyholders' pension payments will not be affected by this transaction - explaining that policyholders of both Paternoster and Rothesay Life would continue to hold their policies with their respective insurers and use their current point of contacts.
Hymans Robertson partner James Mullins (pictured) said the purchase represented a "strong statement" regarding Goldman Sachs' continued ambitions in the pension scheme risk transfer market.
He said that, in turn, this was a strong indication that the buy-in, buy-out and longevity swap market will continue to receive material growth and focus during 2011 and beyond.
Mullins said: "Rothesay Life and Paternoster together have written £7bn of pension scheme risk transfer deals - this would represent an impressive 25% market share of the total buy-in, buy-out and longevity swap deals written since the start of 2006.
"These are particularly impressive figures given that Paternoster only completed its first pension scheme deal in 2006 and Rothesay Life in 2008."
The completion of the deal comes just a month after it was originally announced.
Rothesay Life has conducted a total of £4.3bn of buy-in, buyout and longevity swap deals since it began writing business in 2008 and Paternoster has written about £2.6bn of deals since it began business in 2006.
Paternoster was put up for sale in August after the majority of the firm's backers sought an exit from the specialist pensions insurance company set up by former Prudential executive Mark Wood. It was forced to close to new business in the depths of the financial crisis.
While Paternoster has written no new business since the crisis, its largest shareholder, Deutsche Bank, drew on its expertise to write a £3bn longevity swap for the UK pension fund of BMW in February.
At the time the sale process began, Deutsche Bank owned around 40% of Paternoster. Other shareholders of Paternoster included Eton Park, a private equity firm that owned almost 25%, and hedge funds Polygon, Lansdowne and Cheyne Capital, as well as Numis and Jupiter.
Rothesay Life and Paternoster - The deals so far
|Q1 2008: Rank Group, £0.7bn||2006: £0.1bn|
|Q3 2009: RSA Insurance, £1.9bn||2007: £1.4bn|
|Q4 2009: CDC, £0.4bn||2008: £1.1bn|
|Q2 2010: British Airways, £1.3bn|
|Total Deals: Around £4.3bn||
Total Deals: Around £2.6bn
Source: Hymans Robertson
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