Pensioenfonds Orsima, the €60m pension fund for the Dutch industrial cleaning sector, is negotiating a merger with the €2.9bn scheme for the cleaning and window cleaning industry, BPF Schoonmaak. 

In its newsletter, the board of Orsima said that negotiations to merge on 1 January 2015 were already at an advanced stage.

It explained that the most important reasons of the intended merger were the scheme’s comparatively high costs per participant and its vulnerability due to its size. 

Administration costs per member amounted to €937 last year, according to its annual report.

Orsima said that during the selection process, it had considered joining the €45bn pension fund for the building sector, BpfBOUW, the €16bn scheme for private road transport, Vervoer, and PGB, the €16bn pension fund for the graphics industry.

Orsima added that it had also considered transferring assets to life insurer Aegon, but decided against the move. Recent figures showed that the majority of funds considering their future were opting to merge with others, rather than opt for the transfer to insurance companies. 

Its ultimate decision to opt for the Pensioenfonds voor het Schoonmaak- en Glazenwassersbedrijf, was based on the combination of its contribution level, Schoonmaak’s financial policy, the quality of its provider as well as its indexation potential, it pointed out.

Orsima concluded that its pension plan very much resembled the scheme of Schoonmaak, albeit with the latter offering slightly lower annual pensions accrual and franchise, the amount of the salary that is exempt from pensions accrual.

However, in contrast with Orsima, Schoonmaak had capped its pensionable salary at €51,416. The Orsima board said that both schemes were assessing whether additional arrangements could be made to solve this difference.

That said, Harm Roeten, Orsima’s employees’ chairman, stressed to IPE that recent developments did not yet guarantee a positive outcome of the final negotiations between the pension funds, and that the intented merger could even fall through. However, Roeten declined to elaborate on remaining obstacles.

At September-end, the coverage ratio of Orsima was approximately 110%, whereas Schoonmaak had a funding of 107.6%. 

At the end of 2013, Orsima had 1,054 active participants, 1,303 deferred members and 303 pensioners, affiliated with 38 employers.

The merger talks are the latest in a long line of attempts to consolidate to offset management costs and the increasing regulatory burden.

PGB was recently in talks to merge with PNO Media. However, PNO Media’s chair announced in April that there was neither the “need nor support” for a merger.

New board qualification requirements recently saw the scheme for retailer Peek & Cloppenburg join retail industry scheme.

The industry-wide fund, Detailhandel, is also in talks to merge with furnishing sector scheme Wonen, although negotiations stalled when regulator De Nederlandsche Bank rejected Wonen’s proposal. 

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