Buy-ins and buy-outs
Pension schemes are increasingly exploring how they can best manage and / or transfer the risks associated with their DB pension arrangements to an insurance company in order to de-risk and safeguard benefits.
The last five years have seen an unprecedented increase in buy-in and buy-out activity and, despite market uncertainty due to the political landscape, 2019 is widely predicted to be yet another bumper year for the bulk annuity market, with levels of competition, pension plan funding and pricing predicted to remain at attractive levels.
We have significant experience of advising employers and trustees on buy-ins and buy-outs. Over the last two years we have advised on more than 30 separate bulk annuity transactions of all sizes and structures, with all the major insurers operating in the market. In 2018 the transactions which completed had an aggregate deal volume in excess of £3.5bn, a market share of over 17.5%. We have done at least one transaction with every major insurer since December 2016, including the two biggest deals of 2018 for PIC and Canada Life, and the two biggest deals of 2017 for Rothesay and Canada Life. This means that we are able to advise our clients on the most favourable terms and the pitfalls to avoid.
Read our latest guide for trustees on buy-ins, buy-outs and longevity transaction.
- Advising the Trustee of HSBC Bank (UK) Pension Scheme on a £7bn longevity swap with PICA (the second largest ever deal for a UK pension scheme)
- Advising the trustees of the Smiths Industries Pension Scheme on two buy-outs with Canada Life for £210m and £176m respectively
- Advising Groupe PSA (company) on the Peugeot Advanced Pension Plan’s £140m buy-in with Scottish Widows
- Advising the trustees of the Reuters Pension Fund on their £625m buy-in with Canada Life, the insurers largest ever deal
- Advising the Trustee of the Siemens Benefit Scheme on their £1.3bn buy-in with PIC
- Advising the Trustee of the Royal Mail Pension Plan, Post Office Limited section, on their £450m buy-in with Rothesay Life
- Advising the Trustee of the Tullet Prebon Pension Scheme on their £270m all-risks buy-in with Rothesay Life
- Advising the Trustee of the Cancer Research Pension Scheme on their £250m buy-in with Canada Life
- Advising the Trustee of the Blackwell’s Pension Fund on the transition of the buy-in transacted in 2015 to a full buy-out with PIC and a wind-up of the scheme which completed in June 2017
- Advising the trustees of the Northern Bank Pension Scheme on a £680m buy-in with Prudential, putting in place a collateralised security structure.