Marathon Service Limited Pension and Life Assurance Scheme, sponsored by an oil and gas production and infrastructure company, has completed a £610m buy-in with Rothesay Life, a transaction initiated by its sponsor, RockRose Energy plc.
The bulk annuity transaction secures benefits in full for the 740 pensioners and 700 deferred members in the scheme.
According to Rothesay Life, the employer identified an opportunity for a de-risking transaction on the back of COVID-19 related market movements and then worked closely with the trustees to lock into pricing quickly.
RockRose Energy focuses on onshore and offshore oil and gas production and infrastructure projects, and is listed on the main market of the London Stock Exchange.
“This transaction gives certainty for the members’ pensions with an experienced and financially strong provider,” said Andrew Austin, chair of the company. “The secondary benefit is that it has capped the financial risk to the sponsor.”
RockRose was advised by LCP, which led the transaction, with Sackers providing legal advice. The trustees were advised by Mercer and Herbert Smith Freehills. Legal advice was provided to Rothesay Life by Gowlings WLG.
Tom Seecharan, business development at Rothesay Life, and Chris Martin, chair of the trustees and executive chair of ITS, said close cooperation between the parties was key to the transaction’s completion.
Martin said: “It was clear throughout this process that the scheme and RockRose were working together closely and had a genuine commitment to move quickly if their target could be hit. This was key for us to meet the challenging price objective.”
Ken Hardman, partner at LCP, said the transaction was ”a concrete example of identifying a market opportunity and being able to act quickly on it before market conditions revert”.
The deal is the sixth buy-in in the UK market to have been announced since late July. The others were for: LV=, Littlewoods, ICI, Siemens, and Hitachi. The LV= transaction was a longevity swap conversion.