Clifford Chance, Travers Smith, Eversheds, Pinsents advise on record pension buyout
Clifford Chance (CC) and Travers Smith have advised on what is thought to be the UK's largest pensions buyout to date as Legal & General (L&G) and the trustee of automotive supplier TRW's pension scheme have completed a £2.5bn partial takeover of the fund.
November 27, 2014 at 06:52 AM
2 minute read
Clifford Chance (CC), Travers Smith and Eversheds have advised on what is thought to be the UK's largest pensions buyout to date as Legal & General (L&G) and the trustee of automotive supplier TRW's pension scheme have completed a £2.5bn partial takeover of the fund.
The buyout gives L&G and the trustee control of 16,000 pensioners' benefits. A further 15,000 scheme members were given an offer to exchange future inflation-linked increases for a higher level of non-increasing pension income and to have their benefits secured with L&G, of which 37% accepted.
CC acted for L&G on the deal, having won a role for the insurer on last year's £3.2bn longevity swap with defence giant BAE Systems which saw L&G take on 30% of the financial risk associated with 31,000 BAE pensioners.
Pensions partner Clare Hoxey led for CC, with senior associates Hugo Laing and Matthew Preston. The firm shared the role acting for L&G with Pinsent Masons, with pensions partner Matthew de Ferrars leading the Pinsents team.
Travers Smith acted for the scheme's trustee, TRW Pensions Trust Limited, with a team led by head of pensions Paul Stannard. Other members of the team included finance partner Peter Hughes, finance associate Joe Wren, pensions associate Dan Naylor and pensions consultant Sarah Boon.
Ingrid Everson, pensions partner, led the Eversheds team advising TRW with pension group head Francois Barker.
TRW's pension scheme, which funds some 46,000 beneficiaries, had closed to future accrual in 2009. As part of the buyout, pensioners and deferred pensioners with benefits worth less than £18,000 can cash out their benefits, while additional funding has been provided to maintain the funding level for remaining members' benefits.
Commenting on the deal, Stannard said: "This was an ambitious project and the trustee board is to be congratulated on achieving these outcomes for the members of the TRW pension scheme."
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