TotalEnergies UK Pension Plan Secures £1.2 Billion Buy-in with Pension Insurance CorporationTotalEnergies UK Pension Plan Secures £1.2 Billion Buy-in with Pension Insurance Corporation The TotalEnergies UK Pension Plan has partnered with the Pension Insurance Corporation (PIC) for a £1.2 billion (€1.4 billion) buy-in deal, marking the largest such transaction announced in 2023. This deal complements the scheme’s previous £1.6 billion buy-in with PIC in 2014. The transaction effectively insures the entire £2.8 billion of the scheme’s defined benefit (DB) liabilities. As a result, over 2,000 pensioners, survivors, and 3,500 deferred policyholders have secured their pension benefits. LCP acted as the lead transaction advisor to both the Trustee and the Company involved in the scheme. Sackers and CMS provided legal advice to the Trustees and the Company, respectively, while Addleshaw Goddard advised PIC. Rob White, chairman of the scheme, expressed his satisfaction with the deal, stating that securing benefits for members had been a long-term goal for PIC directors. He acknowledged the complexity and challenges associated with the transaction. Yadu Dashora, partner at LCP, commented on the dynamic nature of the buy-in market over the past decade. Despite the increased prevalence of large transactions, they often present unique complexities. In this instance, the specific benefit structure reflected the legacy of the company’s business. However, Dashora emphasized the importance of thorough preparation and collaboration to successfully navigate these challenges and achieve a favorable outcome. Tristan Walker-Buckton, co-head of origination at PIC, noted the significance of repeat transactions, highlighting the strong relationships established over time. He anticipates further market activity as schemes meet their price targets for buy-in transactions.
TotalEnergies UK Pension Plan has entered into a £1.2 billion (€1.4 billion) buy-in deal with the Pension Insurance Corporation (PIC), a specialist insurer of defined benefit (DB) pension schemes.
According to PIC, the transaction is the largest completed buy-in announced so far this year. According to the transaction, it follows the scheme’s first buy-in with PIC for £1.6bn in 2014.
PIC has now insured all £2.8bn of the scheme’s DB liabilities. The latest buy-in secures the pensions of more than 2,000 pensioners and survivors and 3,500 deferred policyholders.
LCP acted as lead transaction advisor to the Trustee and the Company. The Trustees received legal advice from Sackers and the Company received legal advice from CMS. PIC was advised by Addleshaw Goddard.
Rob White, chairman of the scheme, said securing the benefits for its members had been a long-standing goal of PIC directors, adding that it was “a complex and challenging transaction”.
Yadu Dashora, partner at LCP and lead adviser to the trustee and the company, said: “A lot has changed in the past 10 years since the scheme’s first buy-in was completed. While large transactions are now more common, they typically come with their own complexities – this one had unique structuring requirements and a complex benefit structure that reflected the legacy of the company’s business.
“But as always, a combination of good preparation and close cooperation between all parties ensured that we were able to overcome these challenges and negotiate this significant transaction with PIC, delivering a very attractive outcome for the scheme.”
Tristan Walker-Buckton, co-head of origination at PIC, said: “Repeat transactions like this rely on the excellent relationships that were built using LCP in this case over a decade ago. I expect to see more schemes in the market completing repeat transactions like this once the price targets have been met.”
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