UK - Major British media conglomerate Emap has transferred its two largest defined benefit schemes to Mark Wood's pension buyout firm, Paternoster, the company announced today.
The value of assets transferred for the Emap Earnings Related Pension Plan (EERPP) and the fund of Emap-owned Scottish Radio Holdings (SRH) is around £170m (€241m), according to Paternoster.
"Emap had two clear objectives for this transaction - our desire to secure EERPP and SRH Scheme members' benefits in full and secondly, to remove all pension risk for Emap's shareholders," said Ian Griffiths, group finance director at Emap in a statement today.
Stuart Faloon, a principal and senior actuary at Mercer, who advised Emap and the schemes' trustees over the agreement with Paternoster, commented: ""The nature of the way members' benefits have been secured represents a significant development in the types of risk that insurance companies are prepared to price and accept."
He added: "Traditionally, insurers have required pension schemes to spend years verifying the accuracy of members' entitlements before they would offer terms to buy out the liabilities. This meant that uncertainty over the ultimate price remained."
Branding it an "innovative structure", Faloon said a new opportunity has been created for companies to both secure their employees' benefits and immediately remove their defined pension liability from the balance sheet.
With this latest deal, Paternoster has now secured around £750m in pension scheme assets.