On the go: The National Grid UK Pension Scheme has completed a buy-in transaction with Rothesay Life, worth around £800m.
The deal, which follows a £2.8bn buy-in with the same insurer in 2019, covers members of section A of the scheme and takes the total level of derisked liabilities to £3.6bn.
Following last year’s transaction, Rothesay put in place a monitoring process for the scheme, which allowed it to execute a buy-in for this tranche of liabilities as soon as market pricing and scheme funding allowed, it stated.
The scheme trustees and National Grid were advised by Aon, with legal support from Sackers. Rothesay was advised by Gowling WLG.
Chris Hogg, chief executive of the National Grid UK Pension Scheme, noted that environmental, social and governance factors and climate change are of “paramount importance” to the trustee and were an important factor in its decision-making process.
“We look forward to working with Rothesay who share our commitment to achieving net zero and supporting international agreements to limit future temperature increases to 1.5 Celsius.”
Mike Edwards, partner at Aon, said the transaction “highlights the benefits of the clear strategy and framework for monitoring put in place by the trustee and National Grid last year and also our ability to leverage changing market dynamics”.
“The future-proofed umbrella contract terms, established with Rothesay in the scheme’s previous £2.8bn buy-in, also enabled efficient execution of this transaction,” he added.
