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Rothesay Life announces £185m Makro bulk annuity

13 November 2014

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Rothesay Life has completed a bulk annuity with a pension scheme for former staff of the cash & carry chain, Makro.

Makro Staff Pension Scheme, the "Scheme", begun its de-risking journey in 2011, following closure to future accrual with bulk annuity being the ultimate goal of the subsequent long-term investment strategy.

Rothesay Life head of business development, Guy Freeman, said: "It has taken a lot of hard work from the Trustees, the company and their advisers to reach a position where we are able to secure the Scheme's benefits in this way.

"We were particularly impressed by the company's commitment to achieving this result and its decisive action to capitalise on current economic conditions."

Highlights of the policy, include that the policy will be held by the Trustees as an asset of the Scheme with income paid to the Scheme; Members' benefits are protected against longevity, investment and other risks associated with long-term pension provision; and administration and payment of members' benefits are unaffected by the transaction.

Emma Watkins, Partner at LCP and lead adviser, said: "There are a number of additional complexities in securing benefits for both deferred members and pensioners.

Successful completion of this transaction just over three months after approaching the market demonstrates the preparation and determination on the part of the Trustee and the company to get to this position.

It also shows how well-prepared trustees and sponsors who respond quickly when opportunities arise can take advantage of favourable market conditions and competitive pricing."

Rothesay Life CEO, Addy Loudiadis, said: "It takes significant skill and resource to execute these types of transactions. Our pipeline is as good as it has ever been; this is a reflection of schemes' improved funding positions, corporate demand for full de-risking remaining strong and our position in the market."

Makro is now owned by UK wholesaler Booker after a GBP 140m deal in 2012.

First published - 13.11.2014

Lindsay.sharman@wilmington.co.uk