29 April 2020
“Aon, a leading global professional services firm providing a broad range of risk, retirement and health solutions, has announced that it has advised the trustees of the Leonardo Electronics Pension Scheme on a £160 million pensioner buy-in with Just Group. This is the first buy-in for the scheme in a move to reduce risk while still offering accrual of new benefits to active employees.
Leonardo is one of the world’s top ten aerospace, defence and security companies. This deal covered all pensioners in the company’s £1 billion UK pension scheme for its Electronics, Defence and Security Systems division with non-trivial annual pensions – 1,253 in total.
Mike Nixon, head of pensions at Leonardo UK, said:
“It’s great news that we have secured the benefits of our pensioners with Just Group and that we were able to complete the transaction despite the turbulence in markets. Our scheme is still open to accrual, but our strong funding position meant we have been able to lock down this risk at an early stage. We received excellent support and advice from Aon and our other advisers, Burges Salmon and both the Solutions and Derivatives teams at River & Mercantile, throughout the transaction.”
Michael Walker, principal consultant at Aon, said:
“This complex deal started in late 2019 when markets were stable and completed in late March at an especially testing time in the financial markets. The success required close collaboration between Aon, and the other scheme advisers and continuous monitoring of changing conditions in the gilts and swaps markets – up to the last minute. “We are particularly pleased to have worked with the trustees and with Just Group to have reached this result – and to have helped the Leonardo scheme to achieve its initial de-risking aims.”
David Richardson, Chief Executive Officer, Just Group, said:
“We are pleased to have supported the Leonardo Electronics Pension Scheme progress their de-risking journey and demonstrate that we continue to offer defined benefit de-risking solutions to provide peace of mind to pension schemes at this time of unprecedented change. All parties were very well prepared and we were pleased to show our speed and agility to ensure the transaction was completed efficiently during major market uncertainty.”
Just Group was advised by Pinsent Masons.
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