Siemens has concluded a £300m pension insurance buy-in with Pension Insurance Corportation via the trustees of the VA Tech UK Pension Scheme.

The VA Tech UK Pension Scheme provides pensions for UK employees of the VA Tech Transmission and Distribution business acquired by Siemens in 2006 and now forming part of one of the UK’s biggest suppliers of high voltage switchgear and substation services.

Two tranches of pension liabilities were insured in the transaction; the first £100m of liabilities insured in 2013 by PIC, followed by £200m in December 2015.

The deal, which covers 1,500 scheme members, involved collaboration with Siemens’ captive reinsurer, Risicom Rückversicherung Aktiengesellschaft, whereby a significant proportion of the insured liabilities are reinsured by PIC to Risicom.

Siemens head of pensions John Smith said Siemens is the sponsor of several DB schemes in the UK and there is an overall aim to de-risk the schemes in the medium term.

“Siemens’ Pension Captive Program, in collaboration with PIC, is an important and innovative part of the de-risking strategies which works on a local level as well as at the Siemens group level,” he said.

VA Tech UK Pension Scheme chair of trustees Eric Hurrell said this arrangement provides “greater security” for its members through PIC.

“Multi-national companies are taking a holistic view of their various pension liabilities across the globe as part of their efforts to de-risk and settle these liabilities. Siemens have taken this a step further in this innovative captive reinsurance arrangement,” PIC head of organisation Jay Shah added.

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