Michelin secures benefits with £1.5bn buy-in
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The Michelin Pension and Life Assurance Plan has completed a £1.5bn full buy-in. The transaction includes an in-specie transfer of assets and covers about 15,000 scheme members.
The deal with Aviva completed last month.
“The trustee is delighted to have improved the long-term security of members’ benefits by completing this buy-in transaction with Aviva,” said trustee chair Vincent Dormieux, adding his thanks to the advisory team and to the Michelin Group.
The Michelin trustees were advised by XPS Pensions Group and lawyers Pinsent Masons.
“We were always expecting to see lots of large transactions complete in H2 2024, and we developed a strategy to make this transaction stand out in a busy market,” explained Stephen Purves, head of risk settlement at XPS.
“This included simplifying our transaction requirements before going to the insurers and an ‘in-house’ solution to deal with the plan’s illiquid assets.”
Senior deal manager at Aviva, Sarah Cave, said it was a “well prepared” deal, adding: “Their approach and clear strategy made this transaction attractive to us and enabled us to put our best foot forward when bidding.”
Doug Brown, CEO of insurance, wealth and retirement at Aviva, called the deal “significant”, saying the firm was well positioned to carry out large-scale transactions, in addition to its capability in the small and medium scheme market.
In June, Aviva completed a £200m buy-in with the Merseyside Pension Fund, of liabilities linked to bus company Arriva Merseyside, while in July, it announced a £100m buy-in with the Greggs plc 1978 Retirement and Death Benefit Scheme. Aviva previously revealed deals with smaller pension funds, including for Taunton School, Sibelco and European Metal Recycling.
