International law firm Pinsent Masons has advised the trustee of
one of Babcock International Group PLC's pension schemes (the
Devonport Royal Dockyard Pension Scheme, "the Scheme") on the first
ever longevity swap with a UK pension scheme.
The longevity swap is in the form of a derivative contract, with
Credit Suisse, to provide longevity protection for certain of the
Scheme's pensioners and their dependants. The contract for this
innovative measure was signed after the trustee had considered the
advice of its professional legal, actuarial and investment
advisers. Last month Babcock and the trustee reached agreement in
principle for the Scheme to enter into the swap agreement with
Credit Suisse. The trustee and Credit Suisse have now agreed
terms.
The implementation of the longevity swap has real benefits for
both the Scheme and the Scheme's employer. It is a key part of the
ongoing risk reduction strategy, enhanced member security
arrangements and the evolving investment strategy which the
Scheme's trustee and employer are jointly seeking to improve.
The Pinsent Masons Team advising on the transaction was led by
National Head of Pensions, Christopher Berkeley assisted by Stephen
Woods (Senior Associate, Banking), Matthew de Ferrars (Senior
Associate, Pensions), Louise Townsend (Senior Associate, Data
Protection), John Christian (Partner, Tax) and Toby Thompson
(Associate, Insurance).
Commenting on the transaction Christopher Berkeley said:
"Pinsent Masons has long been involved with Babcock
International Group PLC's pension schemes and we are delighted to
be assisting it and its pension scheme trustees with the reduction
of pension risk. It has been very exciting and challenging for us
to be involved with such an innovative and ground-breaking
project."
Watson Wyatt was the lead advisor on this transaction with the
Government Actuary's Department, Bond Pearce LLP and Mercer also
advising the Scheme's trustee.
Pinsent Masons has one of the strongest pensions teams in
the UK. Spanning offices in London, Birmingham, Manchester
and Leeds we have over 50 highly trained lawyers, paralegals
and independent trustee administrators. For well over 20
years, the firm has been dedicated to providing clear, practical,
cost-effective advice for our clients.
Legal directories such as Legal 500 and Chambers consistently
rate us as a leading pensions firm. With fifteen partners and
no fewer than thirteen "leaders in the field" of pensions, no-one
has more expertise available than we do. Among our clients are
large global corporations, pension fund trustees, public
authorities, insurance companies and other financial
institutions.
Pinsent Masons is an established, full service law firm with
truly international reach, a reputation for delivering both world
class service quality and excellent value, providing a full range
of corporate, financial and commercial legal services to major UK
and international corporations, institutions and public bodies. The
firm ranks amongst the top 100 global law firms and has well over
1,000 partners and other lawyers worldwide.
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