Hymans Robertson advises on £1.8bn buy-in

Hymans Robertson acted as lead adviser to the Imperial Tobacco Pension Fund (the “Fund”) in the completion of a £1.8 billion buy-in with Standard Life, part of Phoenix Group, covering the Fund’s liabilities in respect of c.6,600 members.

The £1.8 billion buy-in is the largest buy-in announced to date for 2021, and Standard Life’s largest bulk annuity transaction so far.

This is the Fund’s first buy-in, with transaction legal advice provided to the Fund by Osborne Clarke and CMS.

Michael Abramson, Partner at Hymans Robertson and lead adviser on the transaction said:

"We are proud to have advised the Trustee on this highly bespoke buy-in transaction. Through close collaboration between all parties, and Standard Life’s willingness to innovate with us, a fantastic outcome has been achieved for the Fund. I’m also proud to say that our risk transfer team led the advice on over £5.5bn of buy-ins and buy-outs during 2021, ranging from streamlined £50m transactions to large complex buy-ins covering over £1bn of liabilities.”

Justin Grainger, Managing Director of Defined Benefit Solutions at Standard Life, said:

“This transaction demonstrates the expertise within the Standard Life team and our continued commitment to the BPA market. We are looking forward to working with the Trustee of the Fund, having been selected as their partner in this transaction."

Helen Clatworthy, Chair of the Trustee of the Fund, said:

“We are delighted to have completed this bulk annuity transaction with Standard Life. This buy-in is a major step in the Fund’s de-risking strategy and significantly improves the security of members’ benefits. Hymans Robertson’s expertise was instrumental in delivering this excellent result for the Fund, and we valued Standard Life’s willingness to work in partnership with us in meeting our objectives.”

David Fripp, independent trustee of the Fund, said:

“This buy-in was the culmination of many months of hard work and close collaboration between a number of parties, largely while working remotely, and we are pleased to announce this at the start of the new year. The Fund initially set robust success criteria and is grateful to our advisers for their insights and leadership in helping us to meet and exceed these criteria.”

Iain Pearce, senior risk transfer consultant at Hymans Robertson and head of alternative risk transfer said:

“We are delighted to have led the execution of this complex project. This is another great example where our team has driven innovation within the bulk annuity market to meet our client’s objectives. The transaction is another example of how large, FTSE 100 sponsored pension schemes continue to see value in de-risking in this way.  Nearly half of the defined benefit pension schemes sponsored by FTSE 100 companies has now completed material risk transfer transactions and to date we have led the advice on 17 of these transactions.”