The CSM Limited (UK) Pension Scheme has completed an £86m full scheme buy-in with Just Group.

The deal was completed at the end of 2021, with the trustee and the sponsor working together within a joint working group.

PwC UK acted as lead transaction adviser to the working group.

According to Just, the working group structure and programme of preparation ensured the trustee and sponsor were able to secure a competitive and efficient process for a relatively small transaction.

After conducting a feasibility study in 2020, the working group received pricing from multiple insurers in three weeks and followed up with a communication exercise to deferred members aged 55 and older.

Four-fifths (80 per cent) of the scheme’s liabilities were for deferred members.

During the process, the scheme’s lawyers reviewed the scheme rules and administration practice, while the trustee hedged the scheme assets to protect against volatile market movements.

The transaction was secured after a two-round competitive process.

Commenting on the announcement, CSM Limited (UK) Pension Scheme trustee and 20-20 Trustees trustee director, Becky Wood, said: “It’s a great result for scheme members to have concluded this deal.

“Through a clear strategy and collaborative approach with the company through the joint working group, advised by PwC UK, we have managed to secure the buy-in much earlier and at a much lower cost than expected.

“We’re now working closely with the team at Just to complete the data cleanse so we can move to issuing individual policies in the future.”

Just Group business development manager, Prashant Mehta, added: “This is another transaction containing significant numbers of deferred pension members.

“It further demonstrates the trust placed in Just Group to support DB trustees and to provide outstanding service and peace of mind to scheme members.

“Ensuring the scheme was very well-prepared provided us with a clear view of the risks and allowed us to price the deal competitively. We are now supporting the trustee to complete the transition and then issuing individual policies to complete a buyout.”

PwC UK lead transaction adviser, Jani Singh, concluded: “We are delighted to have been able to design a solution and transact a deal which met the objectives of both trustee and company.

“We were able to secure competitive pricing and terms from Just, which highlights the increased buyout competition in the market. With six insurers now actively quoting on deals including deferred members, and improved funding levels, schemes are much closer to achieving buyout than they may think.

“This deal is a great example of us working closely with the market to get early visibility on pricing and engagement through PwC Insure. This was critical in bringing the trustee and sponsor together to complete the deal and led to a great outcome for all parties.”

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