Rothesay agrees £2.7bn full scheme buy-in with Thales

Written by Sophie Smith

01/12/2023

The Thales UK pension scheme has agreed a £2.7bn buy-in with Rothesay, securing the benefits of over 16,000 members, including 10,512 pensioners and dependants, and 5,915 deferred members.

The deal was made possible thanks to an agreement reached with the sponsoring employer, Thales, which secured an upfront cash commitment from Thales.

As part of the insurance premium Rothesay also accepted a number of illiquid assets, held in the scheme’s investment portfolio.

Thales was advised by the lead transaction adviser, PwC, and Allen & Overy, and Rothesay received legal advice from Travers Smith. The scheme trustee, meanwhile, was advised by Gowling WLG, Mercer and Momentum.

Commenting on the deal, chair of trustees, Peter Rowley, stated: “We are delighted to have secured long-term security for all our pension scheme members in a single buy-in transaction.

“We are grateful to our sponsor for making this buy-in achievable and to our advisers and Rothesay for their collaborative efforts to execute what was a complex transaction.”

Thales UK director of compensation and benefits, Paul Durrant, said: “This has been an important transaction to the sponsor where we have had to work through a number of new challenges and are therefore pleased that we have been able to secure the pension benefits of over 16,000 current and past employees.

“The advisory teams as well as Rothesay have skilfully navigated the complexities involved in this transaction, quickly finding optimal solutions where needed and completing it in a short space of time.

“This is a hugely successful outcome for us and helps us to meet our corporate objectives.”

This was echoed by Mercer risk transfer partner, Ben Stone, who said: “In a very busy insurer market the effort put in by all parties over recent weeks to make this transaction happen has been phenomenal.

“This demonstrates again that large, complex transactions can complete successfully with clear objectives for all parties to work towards.”

PwC head of pension deals, Swapnil Katkar, also described the deal as the “culmination of significant work by all parties”, stating that “in an increasingly buoyant and competitive market, we are thrilled to reach a successful outcome for the scheme, its members and Thales”.

Rothesay head of business development, Sammy Cooper-Smith, agreed that 2023 has been one of “busiest ever years” for the pension risk transfer market, pointing out that “2024 is already looking incredibly exciting for our market with an unprecedented pipeline as an even greater number of schemes seek insurance solutions”.

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