Dispose of entire asset management division and hire back services: Good idea?

Scope

Key question was to consider a real case study based on the Philips pensions-BlackRock story.
Would it be beneficial from a shareholder’s perspective to sell the internal captive pension asset management division associated to a multinational company to an commercial external player and hire back the services as a customer. Also, options to partner and carving out were considered.

Client

Participants at Nyenrode Business School (mostly leading pension Trustees in the Netherlands) in the program for pension executives: Program Strategic outsourcing and Partnering. The program has been developed by Avida.

Key deliverables

Each participant needed to pass a formal exam which was judged by Avida.

Approach

We have organised a brainstorm in 2 parallel groups which listed various options varying from “full disposal”, “do nothing”, “partnering”, “carving out parts”.