Total insures benefits for £1.2bn in second buy-in
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The TotalEnergies UK Pension Plan has completed a buy-in for £1.2 billion, which follows a 2014 transaction for £1.6bn. Elsewhere, the Leprosy Mission Central Pension Scheme has insured pension benefits for £21m.
Total picked Pension Insurance Corporation, which also insured the previous tranche, for its latest buy-in. The deal covers the pensions of over 2,000 pensioners and dependants and 3,500 deferred members.
Rob White, who chairs the trustee board, called it a “complex and challenging transaction”.
He said: “Securing the benefits for our members has been the aim of the trustee for many years. We are pleased to have reached this milestone by extending our existing relationship with PIC.”
The market has changed in the 10 years since the plan’s first buy-in was concluded, observed Yadu Dashora, a partner at consultancy LCP and lead adviser to the trustee and company.
“Whilst large transactions are more common now, they usually have their own intricacies – this one had unique structuring requirements and a complex benefit structure reflecting the legacy of the company’s business,” he explained.
Repeat transactions rely on the relationships fostered, said Tristan Walker-Buckton, co-head of origination at PIC, adding: “I would expect to see more schemes in the market complete repeat transactions, such as this, when pricing objectives have been met.”
The trustees received legal advice from Sackers, while law firm CMS advised the scheme sponsor. PIC was advised by Addleshaw Goddard.
Leprosy Mission concludes £21m buy-in
While this is one of the largest deals concluded this year so far, the Leprosy Mission Central Pension Scheme has completed a £21m buy-in with Legal & General ahead of a planned buyout.
The insurer said it provided a price lock to the scheme’s existing funds with Legal & General Investment Management and received a novation of the LGIM fund units at mid-price, securing cost certainty during the transaction process.
First Actuarial advised the trustees, while Osborne Clarke provided legal advice to the trustees.
The project was “complicated”, said Gladstone Worthington, head of finance at the Leprosy Mission International, adding: “Legal & General have been our preferred partner throughout the project due to our existing relationship, and we look forward to working closely with them as the scheme moves to buyout.”
First Actuarial advised the trustees. Declan Keohane, head of risk transfer, said: “We look forward to working with Legal & General over the coming months to move the scheme from buy-in to buyout.”
Laurence Crimble, senior actuarial analyst, UK PRT at L&G, noted that “the trustees worked with Legal & General on an exclusive basis to ensure a streamlined derisking process”.
The two deal announcements follow on the heels of two transactions revealed on Tuesday – the NSK Pension Scheme has concluded a buy-in with M&G, and the Menzies Pension Fund with Just Group.
