Business process services provider Equiniti Group is selling Xafinity Consulting, its pensions and employee benefits consultancy, to private equity firm CBPE Capital LLP for an undisclosed amount.
Reading-based Xafinity Consulting employs c370 employees across 6 offices in the UK. It provides a range of services including actuarial, pensions, healthcare, employee benefit consulting and administration as well as self-invested personal pensions (SIPPS) and independent trusteeship. As far as we can tell this is the first investment into the UK pensions sector that CBPE has made.
Following the deal, Equiniti will retain ownership of the Paymaster and Claybrook pension software and administration divisions that also form part of the Xafinity business. Paymaster is the part of Equiniti that won the first central government mutual joint venture, MyCSP, administering pensions for 1.5m Civil Service Pension Scheme members (see Equiniti’s mutual attraction).
Although the deal needs to go through regulatory approval, it is expected to close during the first quarter of 2013. At this point it looks like the Xafinity name will transfer over to new owners CBPE. Equiniti’s CE Wayne Story said that he still expects to partner with Xafinity Consulting in ‘key areas of mutual interest’.
Equiniti isn't pulling out of the UK pensions market. It continues to administer nearly 3m UK pensions and supports over 10m pension scheme members with its software. So it will remain a major player in the market. But it now wants to focus on large scale and complex administration and financial processing contracts. So we assume more deals like myCSP would be very welcome.