Just Group has completed a £260m buy-in for the Menzies Pension Fund, which is sponsored by John Menzies Limited. The scheme completed a previous, pensioner-only buy-in in 2018.
The transaction was completed in March this year and secures the benefits of more than 3,000 members, including almost 1,400 pensioners and more than 1,650 deferred members. The transaction included dovetailing the process with a secondary market sale of an illiquid asset and deferral of premium to enable the buy-in shortfall to be met by a continuation of the existing schedule of contributions.
“This was a collaborative process to achieve a positive solution tailored to the scheme,” said Bob Hymas at BESTrustees, the trustee to the scheme.
“Just Group worked closely and flexibly with all advisers to determine a suitable price lock for the Scheme’s circumstances alongside a premium deferral structure that dovetailed with the Scheme’s funding plan. We are delighted to have secured the pensions of the Scheme’s members,” Hymas added.
“This deal is an example of how effective communication and teamwork enabled Just Group to deliver a bespoke solution for a well-prepared scheme to secure member benefits,” commented Kishan Radia, DB Business Development Manager at Just Group.
“Working closely with the trustee and advisers, we developed an appropriate price lock and premium deferral structure that worked for all parties. This transaction is further evidence of a vibrant bulk annuity market that’s working for schemes of all sizes. At Just we’re able to help schemes, big or small, by tailoring solutions that meet their needs,” added Radia.
Legal advice was provided to the trustee by Brodies LLP Solicitors and to Just Group by Gowling WLG alongside Just Group’s internal legal team. LCP acted as the lead pension risk transfer adviser.
“We are pleased to have advised the Joint Working Group on this transaction, which provides additional security for members’ benefits in a carefully designed transaction that locks in a favourable position for the trustee and sponsor. This transaction shows it is possible to build a strategy balancing the options available for a scheme across the insurance and secondary market for illiquid assets to give the Trustee a clear route to reaching their objective,” said LCP Principal Ruth Ward.
