Mitchells & Butlers (M&B) Pensions Plan has concluded a £1.2 billion bulk purchase annuity transaction, covering around 20,200 members.
The Plan’s deferred and pensioner members were covered by this bulk purchase annuity transaction with Standard Life in May. In this transaction, Gowling WLG provided legal counsel, and XPS Pensions Group served as the trustees’ principal advisers.
M&B Pension Plan chairman of the trustees Jonathan Duck said: “The trustees are very pleased to have concluded a full buy-in with Standard Life, following a period of strong investment performance and continued support from M&B plc, the Plan sponsor. The Plan advisers, XPS and Gowlings, alongside Standard Life, have also displayed great flexibility in structuring the transaction in such a way that buy-in has been possible several years earlier than anticipated.
“This is an excellent result for all Plan members and for M&B plc, something that the trustees have worked hard to achieve over the years. Both the M&B Pension Plan and M&B Executive Pension Plan are now secured with buy-in policies, a great resolution to the historic challenge of past pension deficits.”
Standard Life senior business development manager Rhian Littlewood added: “We are delighted to have been selected to partner with the trustees to secure the retirement incomes of over 20,000 members. This transaction marks a significant milestone for the Plan, and Standard Life is proud to have played a role in supporting the trustees to make this progress in their de-risking journey.
“Throughout the process, we worked closely with the Trustees on a clear strategy and an innovative solution to help manage the sale of illiquid assets, which was crucial to the success of this transaction. Many schemes in the current market environment will face similar challenges to the Plan, and Standard Life is able to support schemes through these to a successful outcome. This transaction demonstrates how innovation, good planning and co-operation between all parties can help facilitate a positive result.”
XPS risk settlement partner Harry Harper commented: “Our strong relationships with insurers made it possible to spot improving opportunities and attract a wide range of insurer quotations, stealing a march on other large schemes that were slower out to market. Working collaboratively with Standard Life, the result has been to provide real certainty to over 20,000 members and to the sponsor by making a bulk annuity affordable at the current time, when previously it was considered to be years away.”
XPS risk settlement partner Jo Carter explained: “This is one of the most complex transactions in recent years. Significant planning and innovation from the XPS Investment team has been needed to tackle the Plan’s multiple illiquid asset holdings. The work undertaken by the XPS administration team, from onboarding the administration in July 2022, has been fundamental to enable attractive pricing and a transfer of data and benefit risk to Standard Life from the point of buy-in.”
Gowling WLG partner Christopher Stiles said: “The M&B Trustees have been a client of the Gowling pensions team for many years, so it is rewarding from both a professional and personal standpoint to see this excellent outcome for the Plan members. The Gowling team is proud to have played its part in the preparation and delivery of the Trustees’ long-term strategy to secure member benefits.”