The James Neill Pension Plan has completed a capital-backed investment (CBI) transaction with Portunes Pension Capital, in a deal understood to be only the second of its kind in the UK pensions market.
Law firm Burges Salmon advised both the trustee and sponsor, James Neill Holdings, on the transaction, which is designed to support the scheme’s long-term funding objectives while allowing it to retain its existing investment strategy.
Under the arrangement, the pension scheme and Portunes will invest alongside one another over a defined period, with the scheme benefiting from a senior-ranking payout backed by external capital.
Capital-backed investments are a relatively new endgame solution for defined benefit schemes. Unlike a traditional insurance buyout, schemes retain ownership of their assets and continue to run on, while gaining access to third-party capital designed to reduce investment risk and provide additional funding certainty for the sponsoring company.
James Neill Holdings is a long-established Sheffield-based industrial group and the parent company of the Spear & Jackson group of businesses, which manufactures hand tools, gardening products, metrology equipment and magnetic technologies. It is part of Sheffield’s steel making heritage and has been established for over 100 years.
This transaction comes amid growing interest in alternative endgame strategies as improving funding levels prompt trustees and sponsors to consider options beyond a full insurance transfer.
Burges Salmon partner Clive Pugh says: “This transaction highlights the increasing maturity of capital-backed solutions in the UK pensions market and the important role they can play in helping schemes manage risk while maintaining investment flexibility.
“We were delighted to support the trustee of the pension plan and James Neill Holdings on this complex and innovative transaction, working closely with all parties to deliver a structure that meets their long-term objectives.”