SEI Investments (Europe), the UK subsidiary of US tech and asset management firm SEI, has entered into an option agreement to buy the outstanding equity of XPS Pensions (Nexus), which is the principal employer and scheme funder of the National Pensions Trust, from XPS Pensions Group.   

  

SEI Investments (Europe), the UK subsidiary of US tech and asset management firm SEI, will take over Nexus, which manages NPT, from XPS for “up to” £42.5m. The total potential sum includes a £35m initial consideration paid at closing, and deferred payments of up to £7.5m that can be earned over two years after the closing, subject to "certain post-closing performance measurements”. The transaction is expected to close before year-end, subject to regulatory approval and other closing conditions. 

 

SEI, which already runs the SEI Master Trust, said it is looking to grow through strategic transactions and strengthen its DC proposition.  

 

"We’ve identified the master trust business as an opportunity for SIEL to participate in a high-growth area of the pensions industry. This builds upon our purchase of the Atlas Master Trust in 2021, which marked the beginning of our execution [of] an inorganic growth strategy to acquire assets and increase our market presence in this segment,” said Wayne Withrow, who heads up global asset management at SEI.  

 

The deal will also create ties between XPS and SEI, as XPS will continue to provide pensions administration and consultancy to NPT and provide support to the SEI Master Trust in the future.   

 

“This is an exciting journey, and with this strategic partnership, both organisations will continue to bring the best of what we each do,” said Paul Cuff, co-chief executive of XPS Pensions Group. 

 

Founded in 2009, NPT has about 60,000 members and £1.4bn in assets, making it one of the smaller master trusts. Together, NPT and the SEI Master Trust will be managing about £3.4bn, which will put it into the mid-ranks of master trusts. 

 

As part of the deal, nine employees will move to SEIL’s institutional business, and one of the NPT trustees will join SEI Trustees Ltd. NPT currently lists as its trustees Vidett’s Aimée Denham and Gerald Wellesley, Michael Brown, Jo Powell and chair Ian Davies. 
 

According to third-party evaluator Go Group, the 10 master trusts with the largest asset base at the end of last year were:

 

Consolidation of defined contribution pension funds is one of the declared goals of the Pensions Regulator and Department for Work and Pensions, including through consolidation among master trusts. 

 

There are 36 authorised master trusts, the 2022-23 scheme return data showed. Excluding hybrid schemes, DC master trusts look after more than £105.3bn in 23.5m member accounts.