Legal & General, the insurance and financial services powerhouse, disclosed that the Cable and Wireless Limited, the sponsoring company involved in this transaction, is an integral part of Liberty Latin America. This conglomerate is renowned for providing top-tier telecommunications services across more than 20 countries, making it a notable player in the global telecommunications landscape.
Meanwhile, the Cable and Wireless Superannuation Fund, referred to as “the Fund” in this context, has a longstanding partnership with Legal & General Investment Management (LGIM). Additionally, the Fund is an existing policyholder of Legal & General, underscoring the trust and confidence that both parties have built over the years.
This latest buy-in arrangement represents the Fund’s third and final transaction with Legal & General, following previous successful buy-ins in 2017 and 2019. This strategic move further solidifies the commitment of both Legal & General and the Cable and Wireless Superannuation Fund to ensuring the financial well-being and security of retirees and deferred members within the organization.
The £340 million buy-in deal signifies a significant milestone in the evolving landscape of retirement and pension fund management, showcasing the continued dedication of Legal & General to providing robust financial solutions for its clients and policyholders.
Legal & General issued a statement explaining their decision. It said: “It is the culmination of a process of reducing investment and longevity risk in the Fund, begun in 2008 when it purchased its first buy-in with another provider. The Fund has now insured all of its members. With support from Legal & General, the Trustee of the Fund was able to react to changing market conditions and transact at an opportune time. Legal & General provided a tailored solution to secure a complex, multi-currency benefit structure, which included a price lock to the value of the Fund’s LGIM assets.”
LCP advised the Trustee of the Fund throughout the transaction while legal advice was provided to the Trustee of the Fund by Hogan Lovells International LLP. Clifford Chance LLP provided legal advice to Legal & General.
LCP provided continuous advisory support to the Fund’s Trustee during the transaction, while legal counsel was furnished to the Trustee by Hogan Lovells International LLP. Legal guidance for Legal & General was extended by Clifford Chance LLP.
Speaking about the move, Kai Hoffmann, Director, Legal & General Retirement Institutional, said, “We are pleased to have built on our long relationship with the Cable and Wireless Superannuation Fund and support this next step of its de-risking journey.
“The Trustee and its advisers ran a very efficient process which allowed the Fund to react to favourable market movements and implement an efficient solution for its complex benefits.”
Dean Johnson, Trustee Director, also commented, “This is a further important step in reducing the exposure of the Fund to investment and other risks such as changes in life expectancy.
“With all benefits payable from the Fund now matched by insurance contracts members can take great comfort in the security of their pensions in retirement.”
Matt Read, Treasurer at Liberty Latin America, said, “We have fully supported the Trustee in this process and are delighted the Fund has reached the stage where all member benefits are insured. This latest transaction leaves the Fund in an incredibly strong position and is a great outcome for members of the Fund and the Sponsor.”
Ben Adams, Partner at LCP, concluded, “It has been a pleasure to work with the Trustee and Sponsor in such a collaborative way and to reach this excellent outcome for members.Market conditions have been changing rapidly in recent months and there were a number of complexities in this transaction including multi-currency benefits.”
He added: “It has taken a great amount of effort and focus from all parties to achieve this and we are delighted to have played our part.”
