The West Ferry Printers Pension Scheme has completed a £120m (€138.8m) full buy-in transaction with Rothesay, a UK pensions insurance specialist.
The transaction follows an agreement made in December 2020 between Reach plc, the parent of the scheme’s sponsor, and the scheme’s trustee to fully fund the scheme as part of a business restructuring, it was announced.
Reach plc is the largest commercial national and regional news publisher in the UK.
During December, Rothesay worked with LCP to price the scheme benefits, thereby providing a transactable price for both Reach plc and the scheme to work with.
A transparent price mechanism, which was guaranteed over the Christmas and New Year period, allowed the trustee to move the assets into a portfolio that gave Reach plc greater price certainty, it said.
The transaction was then executed in mid-February 2021. The transaction is unusual in that over 90% of liabilities relate to deferred pensioners making the liabilities particularly long-dated.
Sammy Cooper-Smith, head of business development at Rothesay, said: “The bulk annuity market performed well in 2020, despite the uncertainty and disruption caused by the COVID-19 pandemic, and we see strong demand from schemes of all sizes to finalise de-risking plans in 2021.”
John Pannett, the scheme’s trustee chair, said: “It is a testament to the expertise of our advisers and Rothesay’s ability to move quickly that we were able to meet the ambitious timetable required to achieve this positive outcome.”
According to recent research by investment consultancy Aon, there has been an increase in the number of small and mid-sized deals as well as increased numbers of pensioner buy-ins rather than full scheme buyouts.
The UK risk settlement market changed “with fewer jumbo deals than we saw in 2019, but a 50% increase in the transactions below £1bn in size,” said Martin Bird, senior partner and head of Aon’s Risk Settlement Group.
”In many ways, this is a sure sign of the market’s increasing maturity, of its understanding of how deals can be put together and of a significant improvement in streamlined transaction processes, which made them more attractive to insurers,” Bird said.
The West Ferry Printers Pension Scheme transaction was led by LCP, acting for the scheme, with Simmons & Simmons providing legal advice. Willis Towers Watson advised Reach plc. Legal advice to Rothesay was provided by Travers Smith.