Specialist, defined benefit pension fund insurer, Pension Insurance Corporation plc (PIC), has insured five WPP pension schemes in a new $140 million transaction, covering pensioner and deferred liabilities.
The agreement covers $140 million of defined benefit pension fund liabilities across five pension schemes sponsored by WPP, the world’s largest communications services group.
The bulk annuity market is experiencing strong demand, and there’s an expectation that more high-profile deals will come to fruition in 2018.
Peter Docking, Independent Trustee Limited, the Trustee Chair for all five pension schemes, commented; “This was a complicated transaction and I want to thank PIC for their dedication and assistance in helping us to achieve our aim of securing the benefits of pension scheme members.”
According to an announcement on the transaction, WPP, via its operating subsidiaries, offers comprehensive advertising and marketing services, which includes advertising and media investment management, data investment management, public relations and public affairs, branding and identity, healthcare communications, digital, eCommerce and shopper marketing, as well as specialist communications.
Head of Business Development at PIC, Mitul Magudia, added; “This is an innovative transaction that simultaneously secures the pension payments of five pension funds sponsored by WPP. This continues the trend of FTSE100 companies that have de-risked their pension schemes in 2017 through insurance.
“The bulk annuity market is currently undergoing a period of intense demand and we expect more such high-profile transactions in 2018, in what many believe will be an exceptionally busy year.”
David Ellis, Partner at Mercer, said; “This is an excellent example of a major corporate and its trustee taking proactive action to manage their pension risks. Mercer is delighted to have been lead adviser on the project.”
And Mike Lane of JLT Employee Benefits, the Scheme Actuary to the five pension schemes, commented; “WPP has been a longstanding client of ours for many years, and I am delighted that we have worked together to deliver this hugely successful exercise, as well as play an important part in ensuring the best outcome for members.”
