The transaction follows a £1.6bn buy-in a decade ago and means the whole scheme is now insured.
The deal is the biggest completed in 2024 so far, as the bulk annuities market continues to demonstrate high levels of activity.
PIC insured £1.6bn of TotalEnergies’ liabilities in a buy-in completed in 2014. This latest transaction means the whole scheme is now insured.
The deal covers more than 2,000 pensioners and dependants and 3,500 deferred members, according to a press release from the insurer.
Rob White, chair of the pension scheme’s trustee board, said: “Securing the benefits for our members has been the aim of the trustee for many years. We are pleased to have reached this milestone by extending our existing relationship with PIC.
“I would like to thank TotalEnergies, PIC, and our advisers for their collaborative and flexible approach in what was a complex and challenging transaction.”
Yadu Dashora, partner at LCP and the lead adviser to the trustees and TotalEnergies on the buy-in, said much had changed in the bulk annuities sector in the decade since the first buy-in was completed.
“While large transactions are more common now, they usually have their own intricacies – this one had unique structuring requirements and a complex benefit structure reflecting the legacy of the company’s business,” Dashora explained.
“But, as ever, a combination of good preparation and close collaboration between all parties meant we were able to overcome these challenges and negotiate this sizeable transaction with PIC, achieving a really attractive outcome for the plan.”
Tristan Walker-Buckton, co-head of origination at PIC, said he expected more schemes that had previously conducted partial scheme buy-ins to complete repeat transactions.
Standard Life’s recent £880m buy-in of the Rolls-Royce & Bentley Pension Scheme involved the conversion of a 2013 longevity swap, while Just Group’s £260m buy-in of the Menzies Pension Fund followed a similar deal six years ago.
With competition and demand in the bulk annuity market increasing, experts have repeatedly stated the importance of collaboration and strong relationships in getting deals done.
Further reading
Standard Life completes £880m buy-in of Rolls-Royce-Bentley scheme (27 June 2024)
M&G, Just Group announce buy-ins worth combined £570m (2 July 2024)
