On the go: The ESAB Group Limited Pension & Life Assurance Scheme has completed a £255m buy-in with Rothesay Life.
The deal, which was completed in August and announced on Monday, covers all 900 members of the welding and cutting equipment manufacturer’s scheme, from which 220 are deferred members.
The transaction is structured as a full scheme buy-in and is expected to move to buyout in the future, at which point the scheme will be wound up, the parties stated.
The ESAB Group Scheme trustees were advised by Mercer and Pinsent Masons, while Rothesay Life was advised by Linklaters.
Robert Careless, trustee board chairman of the scheme, noted that the recent significant improvement in the funding position of the pension fund, along with the support of the employer, “gave us the opportunity to take this decisive step to successfully remove the volatility of the scheme’s funding level and improve the security of members’ benefits”.
Cleo Taylor, business development at Rothesay Life, said: “This transaction reflects the strong demand we are seeing for long-term security from pensions schemes. The trustee of ESAB was well prepared with a clear view of what the scheme wanted to achieve, which was an advantage in a busy market.”
According to an estimate from Mercer, the bulk annuity market is expected to quadruple in the next decade compared with the current one, which has seen £135bn paid to insurers.
