The trustee of the TotalEnergies UK Pension Plan has completed a £1.2bn buy-in with Pension Insurance Corporation (PIC), covering the defined benefit (DB) pension liabilities of over 2,000 pensioners and dependants and 3,500 deferred policyholders.

The deal, which is the largest buy-in announced to date this year, builds on the scheme’s first buy-in with PIC for £1.6bn in 2014, meaning that all £2.8bn of the plan’s DB liabilities are now insured with PIC.

LCP acted as lead transaction adviser for the trustee and company, while the trustees received legal advice from Sackers and the company received legal advice from CMS. PIC, meanwhile, was advised by Addleshaw Goddard.

TotalEnergies UK Pension Plan chair, Rob White, said that securing members’ benefits has been the trustee’s aim for “many years”, emphasising the importance of taking a “collaborative and flexible approach” in achieving this.

“We are pleased to have reached this milestone by extending our existing relationship with PIC,” he continued.

“I would like to thank TotalEnergies, PIC, and our advisers for their collaborative and flexible approach in what was a complex and challenging transaction.”

LCP partner and lead adviser to both the trustee and company, Yadu Dashora, also stressed the importance of collaboration in the buy-in process, noting that while large transactions are more common now, they usually have their own intricacies.

“This one had unique structuring requirements and a complex benefit structure reflecting the legacy of the company’s business,” Dashora explained.

“But as ever, a combination of good preparation and close collaboration between all parties, meant we were able to overcome these challenges and negotiate this sizeable transaction with PIC, achieving a really attractive outcome for the plan.”

PIC co-head of origination, Tristan Walker-Buckton, also suggested that more repeat transactions could be seen in future, adding: “It has been a pleasure working with the plan and its advisers on securing this complex deal.

“Repeat transactions such as this rely on the excellent relationships fostered, in this case over a decade ago, with the aid of LCP. I would expect to see more schemes in the market complete repeat transactions, such as this, when pricing objectives have been met.”

This article as first published on our sister website, Pensions Age.

---