Countrywide Farmers scheme completes £100m PPF+ buy-in with L&G
The Countrywide Farmers Retirement Benefits has secured a £100m buy-in with Legal & General, insuring members’ benefits above Pension Protection Fund (PPF) compensation levels.
The scheme had entered PPF assessment in March 2018 after the insolvency of Countrywide Farmers, but had enough assets to provide PPF+ benefits and left assessment in November last year.
The deal will secure uplifted PPF benefits for 360 deferred members and 712 pensioner members, and is expected to move to buyout in the short term. It has also been structured to allow for further benefits to be insured as the trustees expect additional recoveries from insolvency proceedings.
The uplifts secured above PPF levels of compensation were not disclosed.
The scheme was advised by Lane Clark & Peacock (LCP), Gowling WLG and Osborne Clarke, while Clifford Chance provided legal advice to L&G.
Independent Trustee Services director Hetal Kotecha, who acted as a trustee on the scheme, said: "We appointed LCP to provide specialist PPF+ advice to help us optimise outcomes for members of the Countrywide Farmers Scheme. With LCP's expertise in structuring PPF+ solutions, and competitive pricing and flexibility from L&G, we have secured benefits for members that are far higher than we could have hoped for when we started out on this journey."
L&G Retirement Institutional origination and execution director Rachel Cutts added: "We are pleased that we have been able to deliver this transaction which provides greater financial security for the scheme's members. We have worked closely with LCP to develop an innovative solution for the scheme, and we look forward to our continued work together with the trustee and its advisers."
She added that L&G had a "track record" for helping schemes achieve PPF+ benefits, pointing in particular to the £2.4bn Nortel Networks deal in 2018.
LCP partner Richard Mills added: "We are delighted to have helped the trustee to deliver retirement certainty to members of the Countrywide Farmers Scheme, following the insolvency of Countrywide Farmers.
"Working closely with L&G, we designed a structure to enable the trustee to secure terms up-front for benefits over PPF levels, with the ability to top up members' benefits when further recoveries are received during the insolvency proceedings. This policy gives the trustee significant flexibility if the insolvency proceedings take time to resolve."
L&G has announced £1.9bn of bulk annuities so far this year, including a £1.1bn buy-in and assured payment policy with the Allied Irish Bank scheme in February. A total of just under £9bn of bulk annuities have been confirmed across all insurers.
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