Global pension fund involvement in deal activity continued its declining trend in the fourth quarter of 2022, according to S&P Global Market Intelligence data.

Pension fund sponsors were involved in $5.01 billion worth of disclosed transactions in the 2022 fourth quarter, an 83.5% plunge from the fourth quarter of 2021.

Overall, 2022 was a slow year for pension fund sponsors, as they were involved in deals totaling $26.8 billion, compared to a whopping $105.57 billion in 2021.

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Top 10 transactions

Among the top 10 deals in the fourth quarter of 2022, private equity was an investor in six of them.

But the top two transactions, both of which involved Canada's Ontario Teachers' Pension Plan Board, or OTPP, did not have private equity involvement.

The biggest deal was valued at $1.78 billion when OTPP agreed to buy a 25% stake in Scottish Hydro Electric Transmission PLC from SSE PLC. The deal is expected to close shortly.

OTPP also teamed up with Connexa Ltd. to buy 1,124 mobile tower assets from Two Degrees Mobile Ltd. for about $697.7 million.

In the third-largest deal of the quarter, an investor group including UniSuper Ltd., Host-Plus Pty. Ltd. and IFM Investors Pty Ltd. agreed to buy an unknown majority stake in PRP Diagnostic Imaging Pty Ltd. from Crescent Capital Partners Management Pty Ltd. for about $532.3 million.

Sector exposure

For full year 2022, the technology, media and telecommunications sector attracted the most pension fund investment, with a total deal value of $7.55 billion. The energy and industrial sectors followed with $5.55 billion and $3.69 billion, respectively.