Reckitt Benckiser Pension Fund completes £415m buy-in

The Reckitt Benckiser Pension Fund has secured a £415m buy-in with Scottish Widows, which will cover around half of the scheme’s members’ liabilities.

The Reckitt Benckiser Pension Fund chair of trustees, Brian Bentley, said the team had been working with their advisers over "a number of years" to secure the "right long-term de-risking deal".

The scheme trustees were advised by Travers Smith and Willis Towers Watson, while Scottish Widows received advice from Herbert Smith Freehills and LCP provided advice to the sponsor.

Bentley added: “We are very happy to have formed this partnership with Scottish Widows, which is an important step in the fund’s de-risking journey and in doing so improved the security of benefits for all members.”

Scottish Widows co-head of origination and structuring, Matt Wilmington, commented: “The buy-in was notable not only for its completion at the start of lockdown, with the economic and logistical challenges that brought, but also for the work carried out by the trustees and their advisers to get the fund into a position where a transaction was viable for both parties.

“We’re grateful for that and are looking forward to developing our relationship with the trustees over the longer term.”

Travers Smith transaction legal adviser, Susie Daykin, said the transaction “shows what can be achieved from a truly collaborative team effort and when all parties are aligned to a clear set of goals and objectives”, adding that she was “delighted to have been able to help the trustees achieve this milestone on their de-risking journey”.

Willis Towers Watson lead transaction adviser, Shelly Beard, added: “We were very pleased to help the trustees to secure this transaction with Scottish Widows and the trustees should be commended for staying completely focused on achieving the best outcome for members despite incredibly challenging external circumstances.

“The trustees and the sponsor, Reckitt Benckiser, had set a price target and Scottish Widows worked collaboratively to provide an attractive outcome for the trustees, despite the logistical challenges of a national lockdown and unpredictable economic circumstances. This transaction demonstrates that well-prepared schemes can achieve great outcomes in a flexible bulk annuity market, particularly in times of significant market volatility.”

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