Prudential completes £1bn C&W pension transfer
Prudential has completed the biggest pension transfer seen by the market, in a deal that tops the £800 million annuity purchased by P&O’s pension fund, in December of 2007.
The insurer has acquired £1 billion of liability from the pension scheme of Cable & Wireless (C&W), the international telecoms group.
The purchase takes the form of a pension “buy-in” in which the scheme is purchasing annuity contracts from the insurer, in exchange for assets.
Under the terms of the transaction, C&W trustees will continue to administer the scheme and the group will add £10 million to the fund.
Prudential becomes responsible paying pensions to 5,000 of the fund’s retired members plus the future benefits of members who are still working and contributing and those whose benefits have been deferred.
The insurer expects the takeover to generate an income of £100 million a year from the insurance premium charged to the C&W scheme.
Prudential says it has no plans to acquire further assets from the C&W pension fund.
Category: Insurance News, Prudential Insurance News
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