Pensions Giant WTW in Talks to Buy NatWest’s Corporate Pensions Platform
Introduction to the Deal
Pensions giant WTW is in talks to buy the corporate pensions platform of NatWest Group, known as Cushon. WTW has become the leading candidate to buy Cushon after an auction attended by several leading industry names.
Details of the Acquisition
The negotiated price was unclear, but Cushon manages assets worth £3.7bn, according to the latest figures from NatWest, which bought a majority stake in the company for £144m two years ago. The Annuity business serves around 650,000 members at around 21,000 employers. NatWest owns an 85% stake in Cushon, with the remainder held by the subsidiary’s management.
Strategic Priorities for NatWest
For NatWest, a sale would reflect the bank’s determination to refocus on its core strategic priorities, including a bank-wide simplification program and more active balance sheet and risk management. NatWest’s acquisition of Cushon was aimed at diversifying its non-interest income by offering Cushon’s products to the bank’s business and business banking customers.
Products and Services Offered by Cushon
Cushon offers workplace pension products as well as a range of workplace ISAs, including Junior ISAs, Lifetime ISAs, and general investment accounts. The company’s products are designed to provide employees with a range of savings options.
Pension Reforms and Industry Developments
The government has announced major pension reforms aimed at increasing scale and reducing unnecessary bureaucratic costs, with the aim of creating defined contribution pension schemes managing at least £25 billion of assets by 2030. Chancellor Rachel Reeves has also introduced a multi-billion dollar tax raid on pension systems with salary cuts, causing uproar in the industry.
Conclusion
NatWest and WTW have both been contacted for comment on the potential sale of Cushon. The deal is expected to reflect NatWest’s focus on its core strategic priorities and WTW’s expansion into the corporate pensions market.
