Regional distribution of the Uniq membership at inception of the bulk annuity contract

Key Facts

  • £830m buy-out for the Uniq plc Pension Scheme covering 20,000 members 
  • Rothesay Life provided the Trustee with a mechanism to lock in terms in order to secure benefits in excess of those that would have been offered by the PPF    

The Transaction

  • In March 2011, the Uniq plc Pension Scheme completed a compromise agreement with the sponsoring employer as existing pension benefits were not sustainable. 
  • The Scheme became 90% owner of the company and gave up any future contributions.
  • It was the Trustee’s objective to secure benefits in excess of PPF benefits to avoid falling into the PPF
  • Significant data cleansing work on the level of benefits was required which meant that the cost of the final benefits was uncertain
  • With the backdrop of considerable economic volatility throughout 2011’s Euro sovereign crisis as well, the Scheme was at risk of not being able to secure PPF benefits and falling into the PPF
  • Rothesay Life was able to provide the Trustee with significant price and execution certainty within one week of being selected as preferred provider
  • A guarantee of PPF levels of compensation was provided in respect of the benefits secured under the policy such that there was no risk of the scheme falling into the PPF whilst still leaving the potential to provide benefits in excess of PPF compensation once the data cleanse had been completed
  • Rothesay was able to set its premium equal to the gilt portfolio that the Trustee was holding, thereby removing any volatility between the Scheme assets and Rothesay’s premium requirements
  • On completion the Trustee delivered the gilt portfolio to Rothesay leaving itself with enough cash to complete the data cleanse and wind-up
  • The expectation is that the Trustee will be able to provide members with a top-up to PPF benefits in due course
​Rothesay Life’s ability to lock in terms, and then structure and implement a solution to meet our complex requirements, in a very short period of time, was a key differentiating factor for the Trustee.
Chris Martin of Independent Trustee Services Limited and Chairman of the Trustee of the Uniq plc Pension Scheme
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