UK/ITALY - The Alitalia Italian Airlines Pension and Assurance Scheme has entered into a pension insurance buy-in with Pension Insurance Corporation with a deficit of more than £22m (US$33.7m).
Alitalia's UK scheme is currently within a PPF assessment period after the airline entered administration in 2008. At the time the company collapsed the Italian government owned 49.9% of the shares.
Barnett Waddingham, which advised the scheme, said the fund is significantly underfunded with a S75 (buyout) deficit of more than £22m and trustees will transfer about £53m of assets to PIC.
BESTrustees' Miles Buckinghamshire, who is also chairman of the scheme's trustee board, said: "With pragmatic advice from Barnett Waddingham, we are delighted to have entered into this innovative arrangement with PIC. It has allowed us to lock down our asset and liability position in volatile markets to the benefit of our members whilst we continue to vigorously pursue the trustees' claim in the Italian Administration court proceedings in Rome"
Barnett Waddingham partner Paul Jayson added: "This arrangement is a key step for the trustees of the Alitalia scheme as they work their way through the PPF assessment period. We believe that this insurance policy reduces the risk to members' benefits having captured a favourable position."
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