Logica was bidding as a consortium which included International Financial Data Services and DST Systems.
Chief executive Tim Jones says: “We wish to thank Logica and its key sub-contractors for their engagement with us.
“They are impressive organisations. We enjoyed working with them and have benefited from their input throughout the dialogue process.
“This is a complex procurement and it is not unusual for bidders to re-assess their position as competitive dialogue continues.
“The process with other bidders is proceeding well and we are very confident we will have a strong competition for the final contract.”
Money Marketing reported in October that Danish admin provider Arbejdsmarkedet Tillaegspension or ATP had withdrawn from the running for the contract to administer the scheme.
Pada said the firm decided that providing services for the scheme did not “fit with its commercial model”.
Only Tata Consultancy Services and a team including Great West Retirement Services and Canada Life remain in the running. A winning bidder is expected to be selected by next summer.
A Logica spokeswoman says: “Following an extensive review, Logica and IFDS have taken the decision to withdraw from the Pada procurement process. The reasons for this are confidential.
“Logica and IFDS have enjoyed a highly productive competitive dialogue and withdraw from the bid on very good terms with Pada. Logica and IFDS wish Pada every success in its ongoing bid process.”