Key Facts

  • £45m buy-out transaction for the Panasonic System Networks Pension Scheme covering 600 members with wind-up completed within 12 weeks

The Transaction

As part of the orderly wind-up of the Panasonic System Networks, the scheme trustees and the corporate sponsor reached an agreement to wind up and secure the benefits of the associated pension scheme with an annuity provider.

Outside of the usual requirements of competitive pricing, track record in the market and financial strength, the trustees and corporate had a number of additional requirements:

  • Firstly, the company were aware that a further contribution to the pension scheme would be required, but did not want any surplus to accrue in the scheme as this would be returned net of tax (even though no tax relief had been received on making the contribution).
  • Secondly it was imperative to the company that the liabilities were off balance sheet by the end of September 2014.

In order to facilitate the various requirements, Rothesay Life provided an insurance policy with the following bespoke features:

  • A deferred premium such that the final contribution was only made once the premium true-up was completed;
  • A commitment to issue individual policies or utilise a Deed Poll to ensure the Scheme was off balance sheet by the end of September 2014
  • Rothesay underwrote the financial impact of the GMP reconciliation exercise such that the scheme could have finality before this exercise was completed

Having entered into the contract in June 2014, the scheme was off balance sheet and individual policies issued within 12 weeks. A member forum was hosted specifically to allow members of the scheme to ask questions about the changes.

Rothesay Life recognise the importance of communicating clearly and frequently with members of the pension schemes we insure, and whilst the vast majority of communication needs to be completed in writing we believe that there will always be a place for face to face communication.  

Over the course of 2014 we have supported the MNOPF in a nation-wide series of member forums and more recently in August we hosted a specific forum for the members of the Panasonic Pension Scheme where members had the opportunity to ask questions of the Trustees and members of the Rothesay Life team, to understand what the buy-out of the scheme would mean to them.

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Following a competitive selection process, we chose to transact with Rothesay Life because of their ability to structure bespoke policy which met the needs of our sponsoring employer whilst providing for the best possible outcome for all our members. The Trustees are pleased to be able to offer our members 100% secure benefits with new policies in such a timely manner.

Sandra Connolly, Trustee Chair of Panasonic Pension Scheme
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