A pension scheme sponsored by an unnamed UK insurance company has completed a £150m bulk purchase annuity (BPA) transaction through M&G’s ‘BPA Plus’ proposition.

The transaction, which was executed through M&G’s subsidiary Prudential Assurance Company in June, secured the pension benefits of almost 1,200 members of the scheme.

M&G’s BPA Plus aims to combine the security of a traditional BPA with its £132bn With-Profits Fund, seeking to enable schemes to secure members’ core benefits while sharing in the potential for discretionary bonuses over time.

WTW acted as lead transaction adviser and scheme actuary to the trustee, while Clyde & Co provided legal advice and Mercer acted as investment adviser.

The trustee selected M&G after a competitive process, and cited the insurer’s focus on member experience and capabilities in supporting an efficient transition to buyout as key factors in its decision.

“We are delighted to have partnered with the trustee to deliver this £150m transaction, securing the benefits of nearly 1,200 members,” said M&G head of BPA origination & execution, Rosie Fantom.

“This transaction demonstrates the strength of M&G’s BPA Plus proposition, combining the security of a bulk annuity with the opportunity for future upside through the potential for annual cash bonuses.

“We look forward to continuing to work with the trustee as they progress towards buyout.”

WTW senior director, Ben Todd, added: “The purchase of this buy-in policy follows an extensive buy-in readiness project undertaken by the trustee, led by WTW and supported by the trustee’s other advisers.

“The outcome achieved far exceeds expectations at the start of this journey, with M&G’s innovative BPA plus proposition and other flexibility around money purchase arrangements offering the potential for very positive outcomes for members.”

This article was first published on our sister title, Pensions Age.

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