Nest, the pension scheme with the highest number of members in the UK, has acquired a 10% stake in the holding company of global pension capital investor IFM Investors.

The acquisition remains subject to shareholder and regulatory approvals.

It is expected to complete by the middle of this year.

The pension scheme, which has over 13m UK members and is focused on workplace pensions and auto-enrolment, said the acquisition would support its ambition to diversify and increase its allocations to private market assets to 30%. Nest currently allocates around 17% of investment o private market assets.

Nest and IFM will invest in IFM’s infrastructure, debt and private equity capabilities, with a key focus on new UK investment opportunities.

The pension scheme plans to invest around £5bn through IFM by 2030.

By becoming a 10% shareholder in IFM’s holding company, Industry Super Holdings, Nest will join 16 Australian superannuation funds who collectively own the firm. IFM’s existing owners manage retirement savings of over £580bn.

Existing UK assets currently held within IFM funds include British telecoms company Arqiva, the M6 toll road, and Manchester, Stansted and East Midlands airports.

Mark Fawcett, CEO of Nest Invest, said the partnership marks Nest’s recognition as an international play within the global pensions industry.

He said: “By joining forces with IFM, one of the world’s leading infrastructure managers, we are taking a crucial step towards our goal of investing 30% of our assets under management (AUM) into private markets by 2030.

“We’re excited to leverage IFM's expertise and scale to unlock more private market opportunities that can drive stronger and more impactful returns for our members.

“With £10 billion of our AUM already invested in the UK, our goal is to grow this to £20 billion, and our partnership with IFM will be instrumental in helping us get there.” 

IFM Investors was established over 30 years ago. Owner by Austrialian pension funds, the organisation has £113.7bn under management.