Leadway Holdings completes purchase of PAL Pensions in intensified competition for industry dominance

Leadway Assurance Acquires PAL Pensions in Push for Growth

In a significant move for the Nigerian pension industry, Leadway Assurance has announced the acquisition of Pension Alliance Limited (PAL Pensions), securing full ownership of the company. The merger, if approved by the National Pension Commission, will make the combined entity one of Nigeria's top three pension fund administrators by assets under management.

According to Tunde Hassan-Odukale, group managing director of Leadway, the acquisition is part of a broader push to build scale and trust in the pension system. The transition of PAL Pensions to Leadway Holdings is intended to safeguard customers and employees.

The merger comes at a time when the pension industry in Nigeria is experiencing rapid growth. By the end of 2024, total assets under management in the industry reached ₦20.5 trillion, according to PenCom data. This growth is reflected in the financial performance of other players in the industry.

Leadway Assurance reported ₦173.2 billion in insurance revenue for 2024, a 51% year-on-year increase. The company also paid out ₦117 billion in claims according to its audited financials for the same year.

Meanwhile, PAL Pensions recently crossed ₦1 trillion in assets under management. The company's growth was further boosted by the acquisition, which follows a recent divestment linked to Leadway interests, including a ₦70.8 billion off-market share sale in First HoldCo.

The merger is not the only significant development in the industry. Access Holdings acquired ARM Pensions for ₦152 billion in 2024, creating Access ARM Pensions. By the end of 2024, Access ARM Pensions posted ₦28.2 billion in revenue, ₦3.5 trillion in assets, and a 187% jump in profit.

However, no specific financial details about the Leadway-PAL merger have been disclosed. Segun Odusanya, group managing director of one of PAL's former owners, FSDH, stated that the sale aligns with FSDH's strategy to streamline its portfolio and secure growth for PAL under new ownership.

Customers need clarity on how their accounts will be managed and if any fees or services will change following the Leadway-PAL merger. The combined business aims to target efficiency, innovation, and stronger retirement solutions for millions of Nigerians. The merger is still subject to approval from the National Pension Commission.

In a separate development, Pension Alliance Limited was recently acquired by AIICO Pension Managers Limited. The combined entity will become one of the top-3 pension fund administrators in Nigeria by assets under management.

The news of these mergers and acquisitions comes amidst no prior context regarding Nigeria's plans to loosen pension rules and unlock billions for infrastructure and private equity. The potential for further growth and development in the pension industry in Nigeria is certainly promising.

Leadway Holdings completes purchase of PAL Pensions in intensified competition for industry dominance