The Sibelco UK Occupational Pension Scheme has completed a £165m (€196m) full buy-in with Aviva securing benefits of all its 1,200 members.

LCP acted as the lead adviser on the transaction and legal advice was provided by Fieldfisher.

John Bannister, representing Capital Cranfield, chair of trustees for the scheme, said: “We are pleased to be able to secure our members’ benefits with an experienced, well-regarded insurance company.

“We are confident that Aviva will provide a good long-term home for our members’ benefits.”

Toby Holmes, senior deal manager at Aviva, added that in today’s climate it’s “more important than ever” for schemes to be well-prepared when approaching the market.

He said: “This process has highlighted just how quickly and smoothly a transaction can run when it follows a well thought out and crisply executed transaction process.

“The trustees had a clear strategy to secure member benefits, and their vision, when supported by highly experienced advisers, has made for an efficient and successful transaction.”

Ken Hardman, partner at LCP, added that the transaction highlights the opportunity for well-prepared schemes to leverage strong insurer competition “even in a busy market”.

K3 Advisory launches small scheme buy-in to buyout services

Cosnultancy K3 Advisory has launched a new buy-in to buyout service for bulk annuity transactions specifically designed with small to medium schemes in mind.

The service, which has only been available to existing K3 clients until now, assists trustees and insurers with moving schemes through the transition period from buy-in to buyout, and ultimate wind-up of the scheme.

Andrea Mendham, partner and head of buy-in to buyout services said that many schemes have recently found themselves in a financially strong position and have been able to pursue a buy-in contract with a bulk annuity insurer.

However, she added that after the buy-in contract is signed, the process for moving to buyout – via data cleansing, balancing premium calculation and issuing individual policies – can be a long and neglected road.

She said: “If not carefully managed, this phase can end up lasting many years, with trustees at risk of breaching their contractual terms for the data cleanse.”

She pointed out that trustees and schemes have enough to think about and being able to outsource certain aspects of this “important phase is a valuable time cost efficiency”.

She continued: “It comes down to efficient and proactive project management, coupled with the expertise, time, flexibility and resource to complete specific data and benefit rectification work, or actuarial calculations such as GMP equalisation.

“Getting these done greatly reduces the length (and headache) of the data cleansing phase, saving valuable time and cost for the trustees and sponsor and allowing them to establish full security for scheme members as quickly as possible.”

Mendham added that K3’s status and expertise with small scheme matters means it is in a position to undertake these tasks and move schemes through this phase quickly and seamlessly.

“We are really pleased to bring another tailored service to market that specifically supports the small to medium-sized schemes – providing support, opportunity and resources, as well as demonstrating our ongoing commitment to providing the comprehensive solutions that all schemes, and members, deserve.”

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