Among a family of 2-parameter left invariant metrics on Sp(2), we determine which have nonnegative sectional curvatures and which are Einstein. On the quotient N 11 = (Sp(2) × S 4 )/S 3 , we construct a homogeneous isoparametric foliation with isoparametric hypersurfaces diffeomorphic to Sp(2). Furthermore, on the quotient N 11 /S 3 , we construct a transnormal system with transnormal hypersurfaces diffeomorphic to the Gromoll-Meyer sphere Σ 7 . Moreover, the induced metric on each hypersurface has positive Ricci curvature and quasi-positive sectional curvature simultaneously.2010 Mathematics Subject Classification. 53C12, 53C20, 53C40.