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National Grid Electricity Group has completed a £1.7 billion buy-in for its electricity supply pension scheme.
The transaction, which completed in October, insured the benefits for 5,800 pensioner members of the group. It also included transitioning the group’s existing longevity swap with Zurich Assurance to Aviva.
Aon was the sole transaction adviser and covered actuarial, investment and broking aspects. DLA Piper UK provided legal advice to the group trustee, while the scheme trustee was advised by Mayer Brown International.
Stephen Yandle, chair of the group trustee board, said: “The group trustee is pleased to have been able to take the next important step on our de-risking journey. The transaction is great news for members in the group, adding further protection to their benefits, and on terms that are fully aligned with our strategic objectives.”
Sean Rooney, senior deal manager at Aviva, added: “Our team worked closely with the trustees and their advisers to support them with this important step to provide long-term security for their pensioner members. The transaction included the transition of the group’s longevity swap, and throughout the process all parties have been flexible and focused on delivering a successful outcome. We’re especially proud that we can secure benefits for yet another signatory scheme of AFS’s Sustainability Principles Charter.”
Tom Scott, partner at Aon, said: “We were pleased to support the group trustee with the successful execution of this transaction which marks a further step in implementing the group’s risk settlement strategy. Entering into a longevity swap in 2018 allowed the group to hedge longevity risk until it was in a position to move to buy-in. Having flexibility, via a future-proofed longevity swap contract with Zurich to transition to another insurer, enabled us to achieve an excellent outcome for the group and its members.”
