BAA Pension Scheme agrees £370m buy-in with L&G

Legal & General Assurance Society (L&G) has agreed a £370m buy-in with London Heathrow’s BAA Pension Scheme, securing the benefits of more than 1,400 retirees.

The trustee was advised on the transaction by LCP and legal advice was provided to the trustee by CMS.

This comes after a previous buy-in was agreed with L&G back in 2018, which covered 1,300 retirees and securing approximately £325m of liabilities.

An umbrella contract has been established as part of the transaction, enabling the trustee to potentially ensure further liabilities “quickly and easily” as it continues its de-risking plans.

The scheme is an existing client of L&G, having established a partnership with Legal and General Investment Management (LGIM) to manage the scheme’s assets in 2020.

L&G Retirement Institutional director, Adrian Somerfield, commented: “Having built trust and a strong relationship with the trustee over a number of years, we are delighted to have secured the retirement benefits of another 1,400 members.

“Our umbrella contract ensures we are able to move forward with the trustee in a swift and effective manner as they continue their de-risking plans.”

LCP partner, Ken Hardman, added: “We are delighted to have advised the trustees on the purchase of the scheme’s second buy-in transaction.

“The favourable outcome was achieved through collaborative working between advisers, trustees, corporate sponsor and L&G, allowing is to optimise the drivers of pricing and execute effectively.”

BAA Pension Scheme trustee chair, Phil Wilbraham, said: “The trustee is delighted that this deal continues to de-risk the overall pension scheme and the deal is testament to great teamwork between L&G and the trustees excellent advisory team."

L&G has now secured the benefits of nearly 3,000 members of the scheme, which it said demonstrated “its commitment to a long-term relationship with the trustee”.

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