Convenience stores decide to buy in DB members
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The Spar (UK) Ltd Pension Fund has completed an £11m buy-in, covering 53 pensioners and 34 deferred members. The deal was made possible because of preparatory work carried out by the trustees before approaching the market, such as equalising guaranteed minimum pensions.
The deal was made with specialist insurer Just Group.
Spar (UK) Ltd lends its brand to more than 2,300 convenience stores in the UK. Spar is an international group of independently owned and operated retailers and wholesalers who work together under one brand.
Lee Johnson, strategy and operations director of Spar UK, said: “This is a fantastic outcome for our members, who now have insurance-backed security of their pensions.”
The fact the trustees completed GMP equalisation before approaching the market helped to conclude the transaction efficiently, said Kishan Radia, defined benefit business development manager at Just.
“We expect this will significantly reduce the time to achieve buyout, should that be pursued in the future,” Radia explained, adding: “There is a vibrant bulk annuity market for schemes of all sizes, particularly those that have undertaken important preparatory activity.”
PwC acted as the specialist risk transfer adviser, with legal advice provided by Burges Salmon. Scheme actuarial and administration services were provided by Hughes Price Walker.
Just has recently revealed a £9m full buy-in with the Birmingham Chamber of Commerce and a £400m full scheme buy-in with the pension scheme of an unnamed UK innovation and technology company. In March 2023, it bagged its largest DB derisking transaction to date, a £513m full scheme buy-in with the GKN Group Pension Scheme (No. 4).
Last summer, the firm increased resources by hiring a director of demographic risk and making three new hires in its DB derisking business. It also appointed Mark Godson as its new chief financial officer.
