Friends First is to integrate its asset management business with the operations of F&C, the asset management arm of its parent group Eureko BV. The deal makes Friends First Asset Management part of one of Europe's largest and fund management groups, with assets in excess of €110 billion. Friends First currently has €4.4 billion under management.

F&C Management Ltd is an autonomous, wholly owned subsidiary of Eureko BV. Its headquarters are in London, with local offices in Amsterdam, Lisbon, Boston and now Dublin.

Friends First approached F&C to initiate the deal, a company spokesman said. "In the long term the issue of size and scale will become more important as it has an impact on the ability to deal with changes in the market and customer requirements."

The Friends First Asset Management team will remain in place and Irish equities and property will still be managed from Dublin. The future name of the business will be considered as part of the overall integration process.

Group managing director Mr Aidan Hegarty said the deal was an exciting move for Friends First and its clients.

"We will now have access to a wider choice of investment products and greater investment management experience in key European and international asset classes."

Mr Robert Jenkins of F&C welcomed the integration as a positive move for F&C and for Irish investors. "Our objective is to build a leading, autonomous, European asset management company. This welcome development moves us a step closer to our goal."

F&C is a European full service asset manager and one of the 10 largest active pension fund managers in the UK.

Friends First employs more than 450 people in the Republic, with offices in Dublin, Galway, Cork, Limerick and Waterford.