logo-loader
viewRolls-Royce Holdings PLC

Legal & General wins largest UK pensions risk transfer deal from Rolls-Royce

The transfer of £4.6bn of assets and liabilities relating to the engine maker's pensioners will reduce its post-retirement obligations by around £4.1bn

pensions
L&G has now undertaken four of the UK’s five largest pension risk transfer deals

Rolls-Royce Holdings PLC's (LON:RR.) pension scheme has transferred £4.6bn of assets to Legal & General Group PLC (LON:LGEN) in what is the largest bulk annuity deal written in the UK.

The transfer of assets and liabilities to L&G relates to roughly 33,000 pensioners and will reduce Rolls Royce’s post-retirement obligations by around £4.1bn, the FTSE 100-listed group said in a statement on Thursday.

READ: Legal & General agrees first pension risk transfer in Canada for more than C$200mln

Rolls-Royce will pay a one-off cash contribution of around £30mln but said its free cash flow guidance for the full year remains unchanged.

Having now made four of the UK’s five largest pension risk transfer (PRT) deals, Legal & General chief executive Nigel Wilson said the Rolls-Royce transaction “again demonstrates our extensive strengths and synergies”.

He said the global PRT opportunity “remains sizeable and compelling”, noting that only 8% of the £2.2trn worth of UK defined benefit pension liabilities and 5% of the $3.5trn in the US have completed PRTs.

“Our pipeline and appetite for further transactions in H2 remains strong,” Wilson added.

Rolls-Royce finance chief Stephen Daintith said the deal “represents another step on our journey to simplify, de-risk and strengthen the company” and was a “further step towards ensuring benefits for our pensioners”.

Quick facts: Rolls-Royce Holdings PLC

Price: 703 GBX

LSE:RR.
Market: LSE
Market Cap: £13.57 billion
Follow

Add related topics to MyProactive

Create your account: sign up and get ahead on news and events

NO INVESTMENT ADVICE

The Company is a publisher. You understand and agree that no content published on the Site constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is...

FOR OUR FULL DISCLAIMER CLICK HERE

Watch

PCF Bank's Scott Maybury reports on strong lending growth and increased...

PCF Group Plc's (LON:PCF) Scott Maybury speaks to Proactive London's Andrew Scott after the specialist lender posted record numbers in its latest year. Loans outstanding rose 55% to £339mln with profits for the twelve months to September climbing by 54% to £8mln. Maybury says targets for a...

6 hours, 52 minutes ago

RNS

Total Voting Rights

6 days, 10 hours ago

Director/PDMR Shareholding

3 weeks, 6 days ago

Directorate Change

4 weeks ago

Holding(s) in Company

4 weeks, 1 day ago

Holding(s) in Company

on 31/10/19

2 min read