Legal and General has completed a £1.6 billion buy-in with the BP Pension Fund, marking the first transaction for the £18 billion fund.
L&G provided a gilt-based price lock using the Fund’s gilt holdings, which ensured price certainty while the terms of the transaction were finalised. According to L&G, the price lock “aided the execution of this transaction during a period of elevated market volatility”.
Aon advised the Trustee and was the lead transaction adviser, Linklaters provided legal advice, while Cardano provided insurer covenant advice. Mercer acted as Scheme Actuary, Redington provided the Trustee with strategic investment advic,e while Macfarlanes and DLA Piper provided L&G with legal advice.
L&G says the transaction was defined by “close collaboration between the two parties, including agreeing terms to further support the security of members’ benefits.”
L&G CEO, Institutional Retirement Andrew Kail says: “We are delighted to have completed this buy-in with the Fund, which supports the Fund’s Trustee in its management of risk. A huge thanks to everyone involved for their hard work on the transaction, and to the Trustee for its positive engagement during a thorough selection and implementation process.”
Chair of Trustee Brendan Nelson says: “This buy-in follows a detailed review of the options available to support the Fund’s de-risking journey and hence the security of members’ accrued benefits. On behalf of the Board, I’d like to thank L&G for their collaboration throughout our journey from initial exploration to concluding this transaction, and our advisers for their support.”