The Macfarlane Group PLC Pension & Life Assurance Scheme (1974) has completed a £53m buy-in with Royal London.
Following the buy-in, all the scheme’s liabilities will be fully insured, with the policy paying a regular stream of income that matches the scheme's pension obligations to all members.
Subject to post-buy-in data reconciliations and adjustments, the sponsor and trustees will have the option to proceed to full buyout and wind-up.
The scheme is expected to complete buyout and wind-up within two years if the sponsor and trustees exercise this option.
The scheme’s sponsoring employer, Macfarlane Group, is not required to make any cash contributions for the buy-in as the scheme is in surplus.
If any surplus remains at buyout following buy-in adjustments, excess funds will be returned to the sponsor.
However, if there is a deficit at buyout, the sponsor will be required to provide a matching cash contribution.
Any surplus or deficit at buyout is expected to be no more than £1m.
Macfarlane Group PLC Pension & Life Assurance Scheme (1974) trustee chair, Angela Campbell, commented: "We are pleased the trustees, with the support of the group, have been able to execute the buy-in transaction which meets our objective of securing the pensions of all members of the scheme.
“The buy-in does not change benefits in the scheme and pension payments will continue to be paid each month in the usual way."
Macfarlane Group chair, Aleen Gulvanessian, added: "This positive outcome will de-risk the scheme and is in the interests of both members and the group.
“This development has been achieved through constructive engagement between the group and the scheme trustees over many years."
