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Paternoster secures Chrysalis deal

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  • Paternoster secures Chrysalis deal

UK - Paternoster has agreed a buyout deal for the pension scheme of independent music company Chrysalis Group, which brings the total assets secured by the insurer to more than £1.6bn (€2.1bn).

The latest deal by Paternoster will see it take responsibility for management of assets in the Chrysalis Group Retirement Benefits Scheme, which has been closed to new members since July 1 1994.

The company's scheme had assets totaling £13.9m (€18.4m) and a deficit of £4.6m to the end of 2007, however the firm's 2007 annual report revealed following the disposal of Chrysalis Radio in July, the company directors set aside funding of up to £16m, to enable scheme trustees to achieve a full pension buyout.

But Michael Connole, group finance director of Chrysalis, said although price "was always an important factor", the key was the selection of an organisation "that could tailor their offering to meet our objectives, rather than force us through a standard process".

Mark Wood, chief executive of Paternoster, added: "The sale of part of Chrysalis created an opportunity to secure the pension promise through an insured buyout. In particularly turbulent investment conditions, members' benefits have been fully secured."

Meanwhile, Morgan Crucible, the ceramics and carbon materials manufacturer, is reported to be in exclusive talks with Lucida, one of the most recent entrants to the buyout market, to buy out the liabilities of its two DB schemes.

Morgan Crucible, a FTSE 250 company, runs two pension schemes, the Morgan Group Senior Staff Pension and Life Assurance Scheme (SSS) and the Morgan Pension Scheme (MPS), which had total assets valued at £330m (€438m) at the end of 2006.

However, figures from the firm's preliminary results for 2007, released last week, revealed the scheme's deficit had increased by £5m over the last 12 months to total £47.7m by December 31.

This would be the first acquisition by Lucida since it launched in January if the deal is signed, although the increased deficit suggests if Morgan Crucible is seeking a buyout solution it may have to inject more money than it originally planned in order to reach the buyout funding level.

Neither Morgan Crucible nor Lucida were available to comment at the time of publication.

If you have any comments you would like to add to this or any other story, contact Nyree Stewart on + 44 (0)20 7261 4618 or email nyree.stewart@ipe.com

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