Asda and Walmart complete £3.8 billion pension scheme buy-in


Supermarket chain Asda, owned by US retailer Walmart, has completed a full pension scheme buy-in transaction, worth £3.8 billion.

The transaction, completed with insurance organisation Rothesay Life, secures the long-term pension benefits for approximately 12,300 members of the Asda Group Pension Scheme.

The buy-in procedure has taken place ahead of a full scheme buy-out, expected to take place in late 2020 or early 2021. The agreed buy-out will enable Asda Group Pension Scheme members to receive an individual annuity policy, issued by Rothesay Life, which will pay members’ pension benefits in full.

Professional services firm PricewaterhouseCoopers (PWC) advised Asda and Walmart, while Aon provided advice for the pension scheme’s trustees.

Richard Phillips, chairman of the trustee board at the Asda Group Pension Scheme, said: “We are delighted to have completed this transaction successfully, securing all members’ benefits in what has been a period of heightened market volatility.”

Mike Edwards, partner at Aon, added: “This was a highly bespoke transaction, not least due to the size of the scheme and the liability profile, achieved against the backdrop of the busiest ever year in the bulk annuity market and an uncertain political environment. The collaborative approach between all stakeholders was crucial to achieving such a successful outcome.”

Ben Stone, head of pensions risk transfer at PWC, said: “Securing a deal of this size and complexity in a market that has been so busy in the last few months is a great result for Asda, Walmart, the trustees and the pension scheme members.

“We were delighted to support Asda and Walmart, bringing our buy-out market expertise into negotiations and planning, while implementing solutions to ensure the scheme was prepared to transact as quickly as possible. It shows the importance of a strategic and well-run process, with collaboration between all stakeholders to achieve the desired outcome.”