UK. Legal & General strikes 2.4 billion pounds pension de-risking deal
Legal & General (LGEN.L) said on Monday it had agreed a deal to insure 2.4 billion pounds in pension risk with the Nortel Networks UK Pension Plan, adding its deal pipeline was at a record high.
L&G is at the forefront of demand from some insurers to take on pension-related risk from companies, so-called ‘bulk annuities’, and said at the half-year stage that it expected sales to drive earnings into the end of the year.
The deal with Nortel allows the scheme to exit the Pension Protection Fund, Britain’s pension scheme ‘lifeboat’, where the scheme languished after Nortel went into administration in 2009.
With insolvency proceedings now resolved, the pension scheme had been able to agree a deal with L&G that will give its members better benefits than they would have received in the PPF, L&G said, with more deals likely on the way.
“This transaction brings our total volume for global pension de-risking business to more than 8.4 billion pounds for the year to date, a new record for us,” said Nigel Wilson, chief executive of the Legal & General Group.
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