The UK pension plan for a global manufacturer of electronic test and measurement equipment has completed a £250m (€291m) buy-in deal with Just Group.
The transaction covers the liabilities associated with over 750 members of the Keysight Technologies UK Limited Retirement Benefits Plan. It was completed in the first half of the year and the £250m was included in Just Group’s financial results for that period, but the underlying transaction was not disclosed then.
Willis Towers Watson led Keysight’s deal on behalf of a joint working group formed with the trustees and the plan sponsor. The trustees were further advised on the transaction by Willis Towers Watson as scheme actuary, Linklaters (as legal advisers) and Mercer (as investment advisers), while Pinsent Masons provided legal advice to Just Group.
According to Suzanne Vaughan, senior director at Willis Towers Watson, the Keysight trustees secured participation from six of the eight insurers active in what is a competitive market for pensioner buy-ins, with Just Group considered to have demonstrated the most competitive overall proposition.
Nick Johnson, chair of the trustees, said Just Group had offered “a well-rounded commercially compelling proposition that met the trustees’ needs and most importantly, their people were willing to accommodate the specific requirements of this transaction”.
Just Group entered the bulk annuity market in 2012, and has since received over £8.5bn of pension scheme liabilities.
Earlier this month it was revealed that Artemis Pension Plan had done a £19m full buy-in with Just Group in August. The transaction used LCP’s streamlined service, with the consultancy linking increased demand for streamlined processes to the trend for smaller buy-in and buy-out transactions to be crowded out of the market.
LCP has now completed £2bn worth of sub-£100m buy-ins and buy-outs.
According to Aon, 65% of all deals written in the first half of 2021 were under £100m. It described the UK bulk annuity market as relatively subdued in H1, with this ultimately “a hangover from lockdowns in 2020”.
Overall, it said it expected around £25bn of bulk annuity transactions to be written in the year, with strong momentum to carry over to 2022 trades.