The U.S. is not the only country facing a deluge of retiring baby boomers in need of retirement income advice. Across the pond, the U.K. is tackling the same issue. So it should come as no surprise that, spurred on by that singular demographic trend coupled with the decline of traditional pensions, financial companies aim to merge and grow their business in that arena.
In that vein, Fidelity Worldwide Investment, an asset management enterprise operating throughout the globe except in the U.S. and Canada, just today announced its acquisition of Annuity Direct Ltd. and its holding company, Retirement Angels. No price was revealed.
According to a statement from Fidelity, Annuity Direct will retain its status as an independent financial advisor to individuals, pensions and institutions. Its specialty is aiding consumers looking to convert pension savings into retirement income via an annuity.
Prior to the acquisition, Fidelity publicly declared its intention to expand within the retirement income marketplace.
“As part of our increased investment into our U.K. business, the build out of a new retirement service is a key priority,” said Hugh Mullan, U.K. managing director for Fidelity, in a statement.
To that end, Richard Parkin was recently appointed Head of Retirement for Fidelity Worldwide. “Our ambition as a business is to deliver a retirement service which provides the greatest choice, best guidance, and highest quality service, and ultimately delivers the best outcomes for our customers,” said Parkin, in a statement. “Within the current market there are few services that deliver the quality that customers demand, but also on a scale which supports the growing number of retirees in the U.K. Annuity Direct is one of those exceptions.”
This is not the first time these two firms have collaborated. Last year, Fidelity and Annuity teamed up to develop the “RetireWise” service, which is utilized by Fidelity’s defined contribution pension clients in an effort to help employees select a suitable retirement income product.
The deal awaits approval by the Financial Conduct Authority (FCA) in the U.K. Interestingly, this summer the FCA revealed that it was undertaking a review of whether British consumers were getting a fair deal when they shop for annuity purchase. In the U.K., pensioners typically procure an annuity from their “host” pension provider. However, many observers suspect that consumers are aware they can scan the open market for potentially a better deal.