• Leadway Holdings agreed to buy 100% of Pensions Alliance Limited.

• The merger with Leadway Pensure will create one of Nigeria’s largest pension firms.

• Pension assets in Nigeria could surpass 29.3 trillion nairas by end-2025.

Nigerian financial services group Leadway Holdings Limited has reached an agreement to acquire 100% of Pensions Alliance Limited (PAL), a pension fund administrator in Nigeria.

The deal, announced on September 7 involves the purchase of shares held by FSDH Holding Company Limited and Africa Alliance Insurance Plc, which will transfer their entire stakes to Leadway. The value of the transaction has not been disclosed. It remains subject to regulatory approval, particularly from the National Pension Commission (PenCom), which oversees pension fund management in the country.

Founded in 1970, Leadway operates in insurance (general and life), pensions, asset management, trust services, investment solutions, and hospitality. The group plans to merge Leadway Pensure, its pension subsidiary, with PAL. Founded 20 years ago, PAL manages around 1 trillion nairas in assets ($663 million).

The combined entity will become one of Nigeria’s largest pension platforms, with stronger capacity to manage employee contributions and develop tailored solutions. The acquisition will also strengthen Leadway’s footprint in financial services and position it to capture growth in Nigeria’s expanding pension market.

“This milestone is more than a transaction, it is a reaffirmation of our belief in the future of Nigeria’s pension industry and our responsibility to help contribute to its growth. By bringing PAL and Leadway Pensure together, we are building not only scale, but resilience, trust, and broader access for more Nigerians to create wealth,” said Leadway Holdings Managing Director Tunde Hassan-Odukale.

According to PenCom’s first quarter 2025 report, pension contributions reached 389 billion nairas between January and March, with 52% coming from the public sector and 48% from the private sector.

Credit rating agency Agusto & Co projects Nigerian pension assets could exceed 29.3 trillion nairas by the end of 2025, driven by growing contributions, improved investment returns, and ongoing regulatory reforms. Pension assets stood at 22.51 trillion nairas in 2024, a 22.6% annual increase.

Despite this growth, investment strategies remain heavily weighted toward government bonds, which account for over 62% of total allocations, reflecting a cautious approach focused on security.

The sector still faces challenges, including limited pension coverage, especially in the informal sector that makes up about 93% of Nigeria’s workforce. The Micro Pension Plan, designed to extend coverage to self-employed workers, had 172,936 registrations by the end of 2024, with only 6% active accounts. Persistent negative real returns also weigh on the industry.

Even so, the merger between Leadway and Pensions Alliance is seen as a step toward consolidating the industry and improving pension fund management in Nigeria.