Marks & Spencer transacts £1.4bn Pensioner Buy-in

Collaborative approach paves way for ground-breaking deal

Marks & Spencer has taken another important step in reducing the risks in its £10bn defined benefit pension scheme.  Following the closure of the Scheme to future accrual in 2017, Marks & Spencer has now secured £1.4bn of its pension liabilities with Aviva and Phoenix Life. 

Hymans Robertson has been working with Marks & Spencer since 2010 in order to help it manage its pension costs and risks.  Through a close working relationship with the trustees and their advisers, the pension scheme’s position has improved through the adoption of an investment strategy that reduces risk by aligning investments more closely with the pension benefits needed to pay members. The recent £1.4bn pensioner buy-in is a further step in the journey to ensuring that all members’ benefits are secured, while the risk to shareholders is minimised.

Richard Wellard, Partner, Hymans Robertson said:

“This ground-breaking deal shows how competition in the market can deliver attractive pricing for companies and schemes that are ready to transact.  We are delighted to have had the opportunity to work with Marks and Spencer, the pension scheme trustees and their advisers to support this £1.4bn buy-in.  The success of this transaction demonstrates the benefits of working together collaboratively, and how an innovative approach to scheme funding has helped Marks & Spencer and scheme members.”

Joanna Hawkes, Group Treasurer, Marks and Spencer commented:

“Hymans Robertson has advised us over a number of years supporting the journey to a very strong position.  Their collaborative and pragmatic approach in advising us on this buy-in has ensured that we were able to get all stakeholders aligned on the successful execution of this transaction.”