Sanofi Pension Scheme has completed a £1.4bn (€1.7bn) buy-in securing the benefits of 4,900 retirees and 5,600 deferred members.

The deal was struck with Legal & General Assurance Society Limited.

The pension scheme’s sponsoring employer, Aventis Pharma Limited, is part of the Sanofi group, a French multinational pharmaceutical and healthcare company.

The UK pension fund is a long-standing client of Legal & General’s asset management division, which has managed scheme assets since 1999. In 2021 the scheme struck a £760m partial buy-in with Legal & General, which means that all members of the scheme are now insured via buy-ins with the insurer.

The scheme benefited from an umbrella agreement established with Legal & General as part of the 2021 buy-in, which is said to have ensured a smooth documentation process.

“The trustee is delighted to have now achieved pension security for all members of the Sanofi Pension Scheme,” said Hannah Absolom, trustee secretary.

“The trustee selected Legal & General following a rigorous selection process and it has been a tremendous effort by all parties, with special thanks to Aon for leading the process, and to the CMS, XPS and Aptia teams in supporting the trustee through the transaction.”

Lab

The pension scheme’s sponsor is part of the French multinational pharmaceutical and healthcare company

The deal was announced amid industry reaction to news that the UK government will propose reforms to make it easier for sponsoring employers to access defined benefit (DB) plan surpluses, potentially making run-on a more attractive proposition.

Consultancy WTW yesterday forecast some £50bn in bulk annuity transactions in the UK DB market in 2025 and £20bn in longevity swaps, saying that while a number of well-funded schemes may plan to run on for longer in order to take advantage of improved access to surplus, many would turn to longevity swaps as part of that process to manage their risk.

According to Aon, the total volume of bulk annuity business completed in the UK during 2024 is expected to be in the order of £45bn-£50bn.

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