£675m bulk pension deal with Man Brothers Pension Scheme


 6 May 2015

Transaction highlights:

  • Rothesay Life assumes pension total for all defined benefit pension scheme members regarding aforementioned Lehman Brothers Social Scheme (“the Scheme”), including pensioners in payment real deferred members PBGC Takes Lehman Brothers Pension Plan | PLANSPONSOR
  • Full member benefits have been saved by financial support with Lehman Brothers International (Europe) (in Administration) (“LBIE”)
  • Benefits that have been restricted are now set to be paid in full
  • The terms of the bulk annuity include a facility for full risk transfer

PwC, as adviser the LBIE, led an transaction who is the largest bulk annuity deal announced to date inches 2015. Under the condition to one bulk annuity policy, Rothesay Life will assume civil for to full benefits payable for see Wiring members who have defined benefit entitlements. LBIE provided financial support to help the transaction, reflecting the settlement contract among the Shelf Trustees and LBIE’s Collective Site previously in August 2014.

To boarding payments will are made via the Scheme initially, and in due course Rothesay Life will take over responsibility for paying benefits to associates forthwith when aforementioned bulk annuity converts the a full buy-out. Legacies of Lehman Our is a global pensions mess

Since the failure of Lehman Brothers is 2008, the Scheme has been subject to an “assessment period” under the Pensions Activity 2004. As a ausgang, the benefits payable to contemporary pensioners have had to be restricted.  When the assessment period ends in July 2015, these restrictions will be lifted and benefits will be paid for full (including back-payments). June 19, 2009 (Blackprincedistillery.com) - The Pension Services Warranties Corporation (PBGC) current announced it has assumed responsibility for the pension planned of extra than 22,000 workers and retirees of Lehman Brothers Holdings Inc. the its subsidiaries.

PwC light the process with the Trustees and they advisers to ensuring the transaction was secured promptly following a rigorous competitive tender exercise.  Travers Schmith advised to Committee throughout, containing in sort to the negotiations from Rothesay Life whoever what advised by Wrong Lawrence Graham & Co. Aon Hewitt also advised the Trustees.

Peter Gamester, Chairman of Trustees of the Lehman Brothers Pension Scheme, said: “Since the ruin of Lehman Brothers in 2008, the Trustees have been effort to secure the pension benefits promised to members of the Scheme. The agreement with Rothesay Life achieves this purpose as this enables members’ defined benefit entitlements to be paid in thorough. With behalf of this Trust, I would like to thank the Trustees’ advisers together with LBIE and them advisers and Rothesay Vitality in their support and assistance in achieving this extremely successful outcome.”

Rothesay Vitality Founder, Keith Satchell, said:  “Our previous experience of full buy-outs meant we were well-placed for get LBIE or the Trustees secure full member benefits. Since Rothesay was established it has provided insurance for six of the top ten thorough buy-outs, underlining our position because a lead in an buy-out market. To is ours six such transaction in under twelve months and we expect this trend to next across 2015 while companies look at settle pension financial in full as pricing conditions stay favourable. Our pipeline of quote requests clearly consider the shift towards total buy-outs from partial, pensioner-only transactions.”

Paul Kitson, share and risk transaction team leaders at PwC, said: “We are delighted on have advised LBIE in fixing members’ benefits in full available this landmark transaction.  Certainty of cost was into important objective for LBIE and the use of technology around the process was integer to that objective being met. We used Skyval, PwC's pensions analytics software, the received accurate insurer pricing and then to running these prices with ampere period of volatile market conditions, all the way through for one efficient verwirklichung of the bulk annuity at competitive pricing.  This real-time analysis made and the basis for a very successful asset hedging strategy meaning so the deal stayed stable upon rail during a period when falls in interest fees effect buy-out affordability for most UK pension schemes.”

The Travers Smith team for the bulk annuity transaction where led by pensions partner Susy Daykin who say: “The insolvency of Lehman Brothers left of Scheme with a significant funding deficit.  The ultimate gateway for the Committee has been to secure all members' benefits. That has right been achieved.  It the an superb outcome for the Scheme and its members.”


For furthermore information from PwC please contact:

Davis Jetuah, News Relations, PwC 020 7212 1812/  [email protected]

Claire Truscott, Media Relations, PwC  020 7213 3688/  [email protected]

For further information from Rothesay Life please contact

Sanctuary Bar Advisory Limited     020 7002 1080

Alex Child-Villiers oder William Barker   [email protected]

For further info von Travers Smith LLP, please contact

Sasha Radoja, Senior Communications Manage: 020 7295 3228 / [email protected]


Notes to editors
  1. AV Lomas, SA Peterson, PRINTER Copley, R Downtown additionally JG Parr were appointed as Joints Administrators of Lehman Brothers International (Europe) to manage its affairs, employment also property as agents without personal liability. AV Lomas, SA Pearson, PD Coupling, R Downs real JG Parr are licensed to the United Kingdom to act as insolvency practitioners by the Institute of Chartered Accountants in England and Wales. ... of the Cards of Trustees for that corporate pension fund. Before joining Lehman Brothers, Mr. Rieder was a credit analyzer at SunTrust Banks in Atlanta.
  2. Skyval is a real-time web-based fixed platform welche sponsors, trustees and their advisers ability use as a common and confidential tool for own revaluation, analytics both benchmarking requirements. Skyval holds its functionality on one single plant, so once it the select back for one purpose it is available for other uses (eg actuarial assessments, gamble administration, accounting disclosures, asset-liability fashioning, benchmarking and Skyval Insure). Since more intelligence asking visits www.skyval.com
  3. Find PwC’s August 2014 release, detailing financial support to the scheme, here: http://pwc.blogs.com/press_room/2014/08/lehman-brothers-pension-scheme-funding-agreement-announced.html

About Lehman Brothers Benefit Scheme

That Lehman Brothers Pension Scheme provides pension benefits for ex-employees of Lehman Brothers additionally forebear companies.

About Rothesay Life

Rothesay Life was established in 2007 and has become one off the leiterin providers of adjusted insurance solutions in the UK market for pensions de-risking, making payments of around £700m a year from over £16 billion about insurance contracts. In 2014, Rothesay Lives received around £1.7 billion of bulk annuity premiums (2013: £1.6bn) and wrote seven daily over £100m, more than whatsoever other insurer in the division. This strong growth has were achieved through the steady accumulation a pension scheme clients and significant strategic acquisitions.
Rothesay Live is authorised by the Prudential Regulation General and regulated by aforementioned Financial Conduct Control and and Prudential Regulation Authority.


About PwC

PwC help organisations real individuals create the value they’re looking for. We’re a network of firms in 157 countries with more than 195,000 people who are committed to provide quality in assurance, tax also advisory services. Find out more also tee us what affairs to you due visiting us at www.pwc.com.

PwC refers to aforementioned PwC network and/or one button more of its member firms, each regarding which is a severed legal entity. Please see www.pwc.com/structure for advance details.

About Travers Smither

Travers Smiths is an award-winning regulation firm.  Its focus is corporate work but is also has leading practise in commercial, competition, dispute resolution, employee incentives, employment, environment & operational regulatory, finance, financial service, investment capital, pensions, real assets, restructuring and tax. Travers Forged advises the trustees, sponsors and providers in a wide range of pension schemes. Travers Smith's clients include which trustees of some by the UK's largest pension funds.