Lotto win spells Teachers' second UK control investment

The direct investment platform of Ontario Teachers' Pension Plan has agreed its second direct control investment in the UK: the £389m acquisition of National Lottery operator Camelot.

The Ontario Teachers' Pension Plan is to buy Camelot Group, the company that runs the UK National Lottery, for £389 million (€434 million; $579 million).

Teachers' will acquire the shares from Camelot's five shareholders: Cadbury Holdings, De La Rue Holdings plc, Fujitsu Services, Royal Mail Enterprises and Thales Electronics.

Wayne Kozun, Teachers' senior vice president, underlined the pension's long term investment horizon. In a statement, he said as a pension plan, the fund has a long term time horizon, as it can be 70 years or more from the time a teacher's career begins until the last survivor pension payment is made. “We're known as a patient investor,” he said.

Lotto: £389m win

Kozun's comments come after a sale process in which the Canadian pension was reportedly pitted against UK-headquartered private equity firm CVC Capital Partners. CVC had lined up financing from the Royal Bank of Scotland and Lloyds Banking Group, a report in this Friday's Financial Times said, while Teachers' bid is being backed by the Royal Bank of Canada.

Teachers' owns a number of UK-based assets already, including significant minority stakes in Bristol International Airport and Birmingham Airport. Earlier this year the investment platform's London-based team made its first direct control investment in the UK with Acorn Care and Education, purchased for about $245 million from Phoenix Equity Partners. The deal was notable as Teachers' is an LP in the Phoenix-managed fund on the sell-side of the deal.