3i Group Pension Plan completes £650m buy-in with L&G

The trustees of the 3i Group Pension Plan have completed a £650m bulk annuity deal with Legal & General (L&G).

As reported by our sister title, Pensions Age, the transaction provides a policy which covers the benefits of around 280 pensioners and 570 deferred members.

It follows two previous scheme buy-in deals, one in 2017 with Pension Insurance Corporation and one in 2019 with L&G, and means that the scheme is now fully insured through buy-in policies held as assets of the scheme.

Commenting on the deal, 3i Group Pension Plan chair of trustees, Carol Woodley, said: “This transaction is a significant step forward in providing a more certain and secure solution for members’ future benefits and removes significant risks in the plan that would otherwise be difficult to hedge.

“Achieving this level of security is especially valuable in the current economic climate and we are delighted that, with the support of our advisers, we have been able to take this step sooner than previously anticipated.”

This final buy-in was completed without reliance on the sponsoring company, 3i Group, for any additional contribution.

L&G Investment Management has been providing investment support to the scheme since 2004.

The scheme trustees were advised on the deal by LCP, Linklaters and Lincoln Pensions, while 3i Group was advised by Mercer, and Slaughter and May.

Legal advice was provided to L&G by Macfarlanes.

Mercer principal, Richard Ratcliffe, commented: “We are very pleased to have helped steer the transaction to the successful conclusion of a final buy-in, securing all the remaining risks in the 3i pension plan.

"We had to manoeuvre through challenging market conditions, but through good joint working with the trustees and their advisers, and ultimately with L&G, we were able to gain a very advantageous price for 3i.”

L&G Retirement Institutional CEO, Laura Mason, added: “We are delighted to have continued our partnership with the 3i Group Pension Plan and help complete the final step of its de-risking journey, providing a solution that ensures the long-term benefits promised to its members are fully secured.”

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