The National Grid UK Pension Scheme has completed a £900m buy-in with Rothesay.
The transaction, which completed in July, takes the total value of the scheme’s de-risked liabilities with Rothesay to £4.5bn following a previous £800m buy-in (2020) and a £2.8bn buy-in (2019).
This third transaction covers 7,130 uninsured pensioners of the scheme, made up of both recent retirees and pensioners who have been in payment for a number of years. Rothesay’s in-house asset management team sourced both longer and shorter dated assets to support the nature of the scheme’s pension liabilities.
“Having taken on the position of Chair of the Scheme after the first two buy-ins, the Board and National Grid completed a review of our shared strategic direction and concluded that it was appropriate to continue to de-risk the Scheme and further enhance the security of our members. Through the hard work of all parties and their advisers, it is pleasing to have completed the buy-in. The Scheme’s longstanding relationship with Rothesay supported the smooth and efficient execution of this latest transaction,” said Chris Martin, Professional Trustee at IGG and Chair of Trustees.
“We are delighted to work in partnership with the Scheme again to insure a further 7,130 pensioners and their dependants,” said Roisin O’Shea, Business Development at Rothesay.
“Rothesay is dedicated to providing innovative solutions for its clients and we worked with the trustee of the scheme to create a bespoke solution that met their objectives. Rothesay continues to deliver on its purpose of securing the future for the over one million pensions it protects, supporting schemes’ commitment to providing the highest level of retirement security for their members through an insurance transaction.”
Aon acted as the lead risk transfer adviser on the deal, Rothesay received legal advice from CMS and Sackers provided legal advice to the trustee. LCP provided actuarial and investment advice as well as executive and governance support to the trustee.
“We carefully designed this transaction to meet the objectives of the trustee and National Grid, and Rothesay provided the level of flexibility needed to meet the scheme’s requirements. It is a competitive de-risking market for both schemes and insurers right now and to achieve such a positive outcome via an innovative transaction required a high degree of collaboration between all parties – Rothesay, the scheme and advisers,” said Mike Edwards, Partner at Aon.
“We’re delighted to have supported the trustee through this project in our executive role, with other LCP colleagues also providing actuarial and investment support. The outcome is really positive for members of the scheme, and it’s been great to see everyone working together to achieve this,” said Jonathan Camfield, Partner at LCP.
“We have advised the trustee at each step of this de-risking journey with Rothesay and are confident this most recent transaction delivers on the trustee’s long-term goal of securing a safe and resilient outcome for the scheme’s membership. It has been a pleasure working with the trustee, Rothesay, National Grid and the capable team of advisors in what has been a collaborative and highly professional transaction,” added Ralph McClelland, Partner at Sackers.
