Estonia, Financial Services, Funds, Investments, Legislation, Pensioners

The finalization of the transaction is subject to approval by the Estonian Financial Supervision Authority and the Estonian Competition Authority, LHV Group told the stock exchange.

The transaction will presumably be finalized during the first half of this year provided all the conditions have been fulfilled. The transaction price will be determined upon the finalization and LHV Group will announce it thereafter. In order to finance the transaction, LHV Group will increase the share capital of LHV Varahaldus and purchase subordinated bonds of the company.

The aim of the deal is to expand the business of LHV Varahaldus and thereby offer clients of the mandatory pension fund the best long-term investment service. After the finalization of the transaction the mandatory pension fund market share of LHV Varahaldus will be approximately 30%.

Danske Capital manages three mandatory pension funds and two voluntary pension funds. The assets under management of Danske Capital currently stand at 235.8 million euros and there are over 43,000 active clients in the Danske mandatory pension funds.

The group's fund management company LHV Varahaldus manages five mandatory pension funds, one voluntary pension fund and one UCITS fund. LHV pension funds have around 130,000 active clients.

After finalization of the transaction the plan is to merge Danske Capital with LHV Varahaldus. As the following step, the plan is to merge pension funds with similar investments strategies. The receiving funds shall be LHV pension funds and the merging funds shall be the funds managed by Danske Capital.