Standard Life launched a U.K. pension risk transfer partnership with a consortium led by CVC Capital Partners and Prudential Financial, with a combined initial commitment of up to 2 billion pounds ($2.72 billion).

The partnership also includes Goldman Sachs, MS&AD Insurance Group Holdings and other long-term institutional investors, Standard Life--formerly known as Phoenix Group Holdings--said Thursday.

Private capital firms are taking a growing interest in the U.K. retirement market, prompted by higher interest rates and an aging population. The U.K. market in particular faces an overhang of legacy defined-benefit pension liabilities, which have become buyout targets for insurance platforms backed by asset managers.

Recent transactions in this market include last year's private-credit partnership between Legal & General and Blackstone, and Apollo-backed Athora Holding's deal to buy Pension Insurance Corp for 5.7 billion pounds, also announced last year.

"We think this is highly positive for [Standard Life] as it doubles its capacity in the U.K. PRT market, allowing it to compete with the largest players at the top-end of the market," J.P. Morgan analysts said in a note.

The partnership's combined initial capital commitment is expected to be raised over a five-year period, with 500 million pounds from Standard Life and the remainder provided by the consortium.

Standard Life, which will control 51% of the voting rights, said it expected attractive returns from the partnership and would receive fee-based payments from the consortium.

Total returns are expected to support the company's annual mid-single-digit percentage growth in operating cash generation and underpin its IFRS-adjusted operating profit over time, Standard Life said.

The company expects a minor impact from the partnership on its shareholder capital coverage ratio and its Solvency II debt leverage ratio in the near term.