Sections

Trustees increase demand for buyout advice

Related images

  • Trustees increase demand for buyout advice

UK - An increasing number of employers and trustees are demanding specialist buyout advice as they consider the options for risk management of the scheme, Lane Clark & Peacock has reported.

The firm of actuaries and consultants said the large pension buyout deals reported at the end of 2007, such as P&O and Weir Group, are just the start of a growing trend and it predicted more "notable transactions" in 2008. (See earlier IPE story: Weir Group sells part of £550m fund to L&G)

Clive Wellsteed, partner at LCP, said: "We are not simply talking about schemes closing down and winding up - the trend is instead towards ongoing schemes and finance directors looking to see if a buyout contract makes sense as a pension scheme investment."

LCP revealed its clients closed over £300m (€403m) business in the last two months of 2007 as new entrants into the market, such as Lucida and MetLife, have intensified competition - making it "particularly attractive" for companies to buyout current pensioners as it often costs "less than 10% above the value of the accounting liabilities".

As a result, the firm claimed, the demand for specialist buyout advice is becoming similar to the need for trustees to obtain expert advice in a corporate mergers & acquisition (M&A) transaction. 

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


Have your say

You must sign in to make a comment

IPE QUEST

Your first step in manager selection...

IPE Quest is a manager search facility that connects institutional investors and asset managers.

  • QN-2466

    Asset class: Multi-asset funds.
    Asset region: Global.
    Size: EUR 30m.
    Closing date: 2018-08-16.

  • QN-2467

    Asset class: Search for a broker (mainly ETFs).
    Asset region: Global.
    Size: 250m.
    Closing date: 2018-08-28.

  • DS-2468

    Closing date: 2018-08-24.

Begin Your Search Here