De La Rue Pension Scheme completes £320m buy-in with Scottish Widows

The De La Rue Pension Scheme has completed a £320m buy-in with Scottish Widows, covering the liabilities of around 1,400 pensioner members.

The transaction represents a “significant step” in the scheme’s de-risking journey and helps the trustee improve member benefit security while reducing the risk on the scheme’s sponsoring employer, De La Rue.

Hymans Robertson acted as lead transaction adviser, while CMS provided legal advice to the trustee.

De La Rue was advised by PWC and Slaughter and May, while Scottish Widows was advised by Pinsent Masons.

“We are delighted to have completed this bulk annuity transaction with Scottish Widows,” said De La Rue Pension Scheme professional trustee chairman and Pan Trustees partner, Mike Roberts.

“This buy-in is a major step in the scheme’s de-risking strategy and significantly improves the security of all members’ benefits.

“Our advisers, together with the support and collaboration of De La Rue and their advisers, were instrumental in delivering this result for the scheme, and we valued Scottish Widows’ willingness to work in partnership with us to meet our objectives for the project.”

Scottish Widows head of origination and operations, Lara Desay, commented: “We are extremely happy to have been chosen by the trustee to complete the scheme’s first buy-in transaction, marking a material step in their de-risking journey and providing increased security to their members.

“Working in partnership with the trustee and our respective advisers and to a clearly defined timetable, we were able to complete this transaction around four weeks after being awarded exclusivity. We look forward to becoming a long-term partner of the scheme.”

Hymans Robertson partner, Richard Wellard, added: “We are very pleased to have helped the trustee successfully secure their first buy-in and take this substantial step on their journey.

“We worked closely with the trustee to clearly define their de-risking strategy and identify an opportune time to approach the bulk annuity market. The result was a highly competitive broking process, with Scottish Widows presenting a compelling and tailored proposition.”

Earlier this year, De La Rue entered into an agreement with De La Rue Pension Trustees Limited to bring forward an actuarial valuation of the scheme, following which a reduction in deficit recovery contributions was agreed.

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