PwC, as advisors to Amey, led the process with the Trustee PTL (Pitmans Trustees Limited) following a rigorous and competitive tender exercise. The Trustee purchased two separate buy-in policies with Just Retirement Limited, a life insurance company of JRP Group plc, covering pension benefits for 1,000 scheme members. Prices were fully protected against market activity during the EU Referendum period with both transactions completed five weeks after receiving initial prices from a panel of insurers.
The buy-in pricing opportunity was clearly and quickly identified using PwC’s online pensions analytics tool Skyval, which allows for insurers to provide initial scheme-specific pricing within a matter of days.
Ben Stone, pensions consulting director at PwC, said: “We are delighted to have advised Amey in completing buy-in transactions for pensioner members of the Amey OS Scheme. The transaction opportunity was spotted quickly using our market-leading price discovery tool, Skyval Insure, and our client then set us a challenge to ensure the two buy-ins were completed without market movements taking the project off-track. We worked with Just Retirement and the Trustee to agree a mechanism whereby the scheme assets were fully matched to the buy-in price movements during the five week period from initial insurer quotations to deal completion. This was a significant achievement for the scheme – particularly given the large fluctuations in investment markets during that period.”
Tim Coulson, Just Retirement director of DB Solutions, said: “We are delighted to have concluded this transaction with the Trustee of the Amey OS Pension Scheme, particularly in such an efficient manner and during a period of very volatile market movements. It is a testament to PwC, the Trustee and the team at Just Retirement that we were able to hedge the market movement during the EU referendum.”
Kim Nash of PTL, Sole Trustee, said: “PTL were pleased to play a part in the successful buy-in for the Amey OS Scheme. These types of transaction are complex and need careful management to ensure advice is received in a timely manner to carry out the exercise efficiently. We believe our role as sole professional trustee ensured we could react quickly to the company’s initiative for a buy-in and achieve an agreed hedging mechanism ahead of the EU Referendum.”
Andrew Devlin, Amey’s Pensions director, said: “Amey and its parent company, Ferrovial, has established a joint Pensions Risk Management Group to ensure first-class governance of Amey’s UK pension schemes, whilst mitigating pension risk to the business. One goal was to identify and implement measures to actively manage longevity risk. It is therefore highly satisfying to have quickly taken steps to deliver on this objective, whilst at the same time addressing other major pension risks. Amey is most grateful to the Trustee and its advisers for their positive response to the company’s initiative and their proficiency in highly challenging circumstances. We thank PwC for their advice, creativity and support throughout the process.”
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