Aviva has announced the completion of its £130m ($165m) bulk purchase annuity full scheme buy-in with the Trustee of the Telereal Pension Plan.
As a result, Aviva will insure the defined benefit liabilities for close to 500 members, cutting the investment and longevity risk.
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Furthermore, members will see no change in their benefit entitlement as a result of the transaction.
Sean Rooney, BPA senior deal manager at Aviva, said: “We’re delighted the Trustee selected Aviva to secure member benefits, and we’ll continue to work closely with them to ensure a smooth transition. The process was well managed and completed quickly, thanks to all parties collaborating to reach a successful outcome. We look forward to welcoming Telereal members as Aviva customers in due course.”
Carl Clissold, chair of trustees of the Telereal Pension Plan, added: “The Trustees are delighted to have reached this significant milestone for the Members and would like to thank all parties, including the Plan’s sponsor Telereal Services Limited, who have all collaborated in closing this transaction within a short timescale. Our work will continue as we prepare the Schemes for buy-out with a smooth transition and the delivery of Member benefits.”
Joe Hathaway, associate partner at Aon, stated: “Achieving attractive terms for the Trustees was contingent on a quick execution and relied on all parties working extremely hard over just a few weeks. The straightforward execution offered by Aon’s Pathway service – which is specifically designed for schemes of this size – was vital in allowing us to move quickly.”
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By GlobalDataEarlier this week, Legal & General Assurance Society announced that it has completed a buyout with Nortel Networks UK Pension Plan.
This deal between Legal & General and Nortel insures the final tranche of plan members’ benefits. It consisted of a £14m initial premium, and a £6m top-up on buyout. As a result, Legal & General has now insured £2.5bn of the plan’s liabilities.
The plan’s sponsor went into administration in 2009 and entered a Pension Protection Fund (PPF) assessment. While in assessment the plan was able to secure material additional funds from the Nortel insolvency process to improve member benefits.
