Members secured

39,000

Value

£4.7bn

Type

Full buy-out

Impact

  • Absolute upfront certainty with no further premiums due
  • Cover for residual risks from transaction completion
  • Premium locked to scheme’s assets up front during volatile markets

Background

The G.E.C 1972 Pension Plan was disproportionately large compared to the sponsor company. The trustee decided to de-risk the assets, hedge rates and inflation and slowly try to improve the funding level of the scheme.
10+ years later, the trustee believed it was close to securing all members’ benefits through a buy-out.

 

Highlights

Clear objectives

The trustee met insurers prior to coming to market, and clearly set out their key objectives specifying their requirements for the buy-out to take place. This direct articulation allowed us to focus our resources on creating a tailored solution that met the needs of the scheme

Well-prepared trustee

The trustee carried out extensive due diligence on its historical documentation and administration before coming to market. This allowed us to accelerate our own due diligence and provide a guaranteed price early on in the process

Single up-front premium locked to the scheme’s existing assets

We locked our premium to the scheme’s portfolio of gilts, corporate bonds and swaps. This upfront premium also provided cover for residual risks from the point of signing, meaning no further premium would be due following completion of the transaction. The Trustee therefore had absolute certainty on the premium that would be required, over a volatile period in global markets

Close work with administrators

We worked closely with scheme’s administration team throughout the process and implementation to ensure a smooth transition to insurance and full wind-up of the scheme