Investment - Articles - Peugeot Pension in bulk annuity deal with Scottish Widows

The Trustee of the Peugeot Advanced Pension Plan has secured a c. £140m buy-in with Scottish Widows, covering all members of the Plan. The ultimate parent company of the Plan is Groupe PSA, who worked closely with the Trustee to ensure the successful completion of this transaction.

 The agreement secures the benefits of all Plan members and the premium structure agreed with Scottish Widows minimised the overall funding required to the Plan whilst still providing full coverage of benefits – a key requirement both for the Trustee and the Company. Good quality data and extensive due diligence completed upfront ensured certainty of cost to the Trustee ahead of entering into the contract.
 Willis Towers Watson was the lead advisor to the Trustee on the transaction, alongside Gowling WLG (UK) LLP and Aon, with Natixis and Sackers advising the Company. Scottish Widows was advised by Herbert Smith Freehills.
 Geoff Benney, one of the Trustee Directors of the Peugeot Advanced Pension Plan, said: “This full buy-in is the culmination of many years’ work by the Trustee to de-risk the Plan. Scottish Widows presented an attractive deal which provides comfort to the Trustee in regard to the security of members’ benefits and certainty of overall cost.”
 Ian Aley, Head of Transactions at Willis Towers Watson, said: “We were happy to advise the Trustee on the purchase of this full-Plan buy-in. Scottish Widows’ flexibility in providing a comprehensive policy combined with an innovative premium structure to meet our client’s requirements demonstrates that, even in today’s very busy market, well-prepared schemes can negotiate bespoke arrangements to meet their needs.”
 Richard Ratcliffe, Head of Pension Advisory at Natixis, said: “We have been working with Groupe PSA to build support for a transaction. Ultimately, a collaborative approach with the Trustee and their advisers helped to achieve a deal structured in such a way that provides certainty for the Company and minimises the overall funding required through to the end of the process.”
 Emma Watkins, Director of Individual and Bulk Annuities at Scottish Widows, said: “We are delighted to have been chosen by the Trustee and Groupe PSA for this bulk annuity transaction after being able to demonstrate our commitment to meet their bespoke requirements. Groupe PSA is a key client of our parent company Lloyds Banking Group and we are pleased to strengthen an existing relationship through this arrangement.”

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