BT buys utility stake to manage inflation risk

14.10_HandshakeThe BT Pension Scheme (BTPS), the UK’s biggest corporate retirement fund, has acquired a minority stake in Thames Water, the largest waste and water company in Britain. BTPS says it is seeking greater exposure to domestic infrastructure investments that have a natural linkage to UK inflation because its own liabilities are linked to inflation. Frank Naylor, head of strategy for BTPS Management, the executive arm of BTPS, said the investment demonstrated BTPS’s ongoing commitment to investing in domestic infrastructure. “Thames Water is a well established business governed by a mature, transparent regulatory regime that should provide predictable inflation-linked cash flows over the long term.” BTPS is the largest UK corporate pension fund with around £38 billion (€47.5 billion) of assets and significant inflation-linked liabilities. The stake was made through a shareholding in Kemble Water Holdings Limited and the acquisition was arranged by Hermes GPE, the pension fund’s infrastructure adviser, which will also manage the interest. ©2012 funds europe

Executive Interviews

INTERVIEW: Put your money where your mouth is

Jun 10, 2016

At Kempen Capital Management, they believe portfolio managers should invest in their own funds. David Stevenson talks to Lars Dijkstra, CIO of the €42 billion manager.

EXECUTIVE INTERVIEW: ‘Volatility is the name of the game’

May 13, 2016

Axa Investment Managers chief executive officer, Andrea Rossi, talks to David Stevenson about bringing all his firm’s subsidiaries under one name and the opportunities that a difficult market...


ROUNDTABLE: Beyond the hype

Oct 13, 2016

The use of smart beta investing continues to grow. Our panel, made up of both providers and users, discusses what the strategy actually means, how it should be used and the kind of pitfalls that may arise when using this innovative investment technique.

MIFID II ROUNDTABLE: Following the direction of travel

Sep 07, 2016

Fund management firms Aberdeen and HSBC Global meet with specialist providers to speak about how the industry is evolving towards MiFID II.