The Sportech Pension Scheme has entered into an agreement with Just Group for a £2.5m buy-in ahead of a planned buyout.
The deal, which completed in March, was aided by a £234,000 exceptional cash contribution, with the online gambling and entertainment company also agreeing to cover all administrative, actuarial and legal costs.
The transaction is an example of hundreds of smaller bulk annuity deals being transacted in the market where announcements more often relate to deals in the hundreds of millions or billion pound price range.
The scheme and Just Group are now working through due diligence and underwriting ahead of an anticipated full buyout and wind-up towards the end of the year.
So far this year, Just Group, which has a history of completing deals of this size, has completed £512m of bulk annuity transactions. The market as a whole has insured £19.1bn of pension scheme liabilities.
Just Group business development manager Peter Jennings commented: "As this transaction demonstrates, at Just we help schemes of all sizes on their de-risking journey. This deal was made possible because, from the outset, everyone involved in the transaction was committed to a clear common goal to deliver an efficient, lean process."
It is the first deal confirmed to have been completed by Just so far this year, while market news has been dominated by a number of record-breaking deals.
The first half of the year was the busiest ever first-half period for bulk annuities, with a number of mammoth deals, including the biggest ever buyout deal, completed for the Rolls-Royce UK Pension Fund with Legal & General.
Meanwhile, the £3.4bn buy-in for the British American Tobacco Pension Scheme was the largest to cover both pensioner and deferred members. In addition, a £7bn longevity swap between the HSBC Bank (UK) Pension Scheme and Prudential Insurance Company of America has boosted total pension risk transferred to £26.1bn.
The Tate & Lyle Pension Scheme has completed a £930m full buy-in with Legal & General (L&G), insuring benefits for around 4,800 members.
There have now been a total of around 50 buy-in and buyout deals of over £500m announced since 2007. The full list, provided courtesy of LCP, is as follows...
Defined benefit (DB) schemes should act now to insure members’ benefits before an “anomaly” in the markets is corrected, Prudential Retirement has said.
Growing market volatility could adversely affect defined benefit (DB) schemes nearing buyout over the next five years, Barnett Waddingham says.
Legal & General (L&G) has entered into an agreement with US law firm Locke Lord for a £35m buyout of UK-based Edward Wildman Palmer pension scheme.