L&G insures Cable & Wireless members with final buy-in
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Legal & General has secured a £340m buy-in deal with the Cable & Wireless Superannuation Fund, securing the benefits of around 1,800 retirees and deferred members.
The sponsoring company, Cable & Wireless Ltd, is part of Liberty Latin America, a provider of telecommunications services in more than 20 countries.
According to the insurer, the fund is a long-standing client of Legal & General Investment Management and is an existing policyholder of L&G. The move marks the fund’s third and final transaction with the insurer, following buy-ins in 2017 and 2019.
The fund has now insured all of its members. L&G described the process as a “culmination” of reducing investment and longevity risk in the fund, which started its first buy-in with another provider in 2008.
Matt Read, treasurer at Liberty Latin America, said the transaction leaves the fund in an “incredibly strong position”, describing it as a great outcome for members of the fund and the sponsor.
According to L&G, the insurer provided a tailored solution to secure a “complex, multi-currency benefit structure”, which included a price lock to the value of the fund’s LGIM assets.
Kai Hoffmann, director at Legal & General Retirement Institutional, said: “The trustee and its advisers ran a very efficient process which allowed the fund to react to favourable market movements and implement an efficient solution for its complex benefits.”
LCP advised the trustee of the fund throughout the transaction, while legal advice was provided to the trustee by Hogan Lovells International. Clifford Chance provided legal advice to L&G.
Ben Adams, partner at LCP, said: “Market conditions have been changing rapidly in recent months and there were a number of complexities in this transaction including multi-currency benefits. It has taken a great amount of effort and focus from all parties to achieve this, and we are delighted to have played our part.”
Last month, L&G expressed its ambition to write up to £12bn of UK pension risk transfer business a year, with its outgoing chief executive Sir Nigel Wilson saying the changes to the risk margin as part of the reforms of the Solvency II regime in the UK would give the firm headroom to write more bulk annuities.
Can L&G achieve its goal?
