M&G, Just Group announce buy-ins worth combined £570m

M&G completes buy-in with NSK scheme

The deal in brief:

• Value: £309m

• Employer: NSK

• Insurer: M&G

• Type: Buy-in

• Members covered: 3,700

Machinery manufacturer NSK has insured approximately 3,700 members of its UK defined benefit (DB) pension scheme through a buy-in with M&G.

The deal, valued at £309m, was completed in the first quarter of 2024. M&G’s wholly owned insurance subsidiary, The Prudential Assurance Company, was the insuring entity.

The NSK transaction was the third buy-in completed by M&G since it re-entered the bulk annuity market last year. It has now written deals worth roughly £930m.

Mark Trivett, chief financial officer at NSK Europe, said: “The company is delighted to have supported the trustee in securing this buy-in policy. It shows our commitment to the scheme and members’ long-term security.

“This transaction is a major milestone in our collaborative approach with the trustee to reduce risk over the years.”

Steve Metcalfe, chair of the scheme’s trustee board, said: “Insuring our members’ benefits has been a key aim of the trustee and company, providing long-term security.

“To achieve this key aim within the required timescales was challenging but the trustees were expertly supported thanks to Aon and CMS’s deep knowledge of the insurance market, allied with a collaborative approach across all parties. The trustee is delighted with the outcome.”

John Menzies and Just collaborate on complex buy-in

The deal in brief:

• Value: £260m

• Employer: John Menzies Ltd

• Insurer: Just Group

• Type: Buy-in

• Members covered: 3,000+

Just Group has insured the benefits of more than 3,000 pensioner and deferred members of the Menzies Pension Fund, sponsored by aviation services company John Menzies.

The transaction was completed in March this year and was valued at £260m. It followed a pensioner-only buy-in that was completed in 2018.

According to Just Group, the transaction included “dovetailing” the buy-in timeline with the sale of an illiquid asset. The scheme also made use of a price lock and deferred premium, which allowed a funding shortfall to be met by the employer’s existing contribution schedule.

Ruth Ward, principal at LCP, which advised on the deal, said the buy-in “provides additional security for members’ benefits in a carefully designed transaction that locks in a favourable position for the trustee and sponsor”.

She added: “This transaction shows it is possible to build a strategy balancing the options available for a scheme across the insurance and secondary market for illiquid assets to give the trustee a clear route to reaching its objective.”