Aviva Secures £300m Bulk Annuity Buy-in for Elementis Group Pension Scheme

Quick Summary

Aviva has finalized a £300 million bulk annuity buy-in with the Elementis Group Pension Scheme, securing benefits for 4,500 members. The deal utilizes an integrated DB&C Master Trust solution to provide tax-free cash options while leveraging a price lock to ensure pricing certainty during the transition.

How Does Aviva Secure Pension Benefits for Elementis?

Aviva solves the challenge of long-term pension liability by providing a comprehensive bulk purchase annuity (BPA) that covers defined benefit liabilities for the Elementis Group. By implementing a strategic price lock, the Trustee was able to transition credit fund holdings into the premium payment portfolio without the typical mismatch risk associated with market volatility.

• 4,500 members secured under the new agreement.
• £300 million total transaction value.
• Integrated Master Trust solution for tax-free cash access.

Sean Rooney, Senior BPA Deal Manager at Aviva, said: "Completing this transaction with the Elementis Group Pension Scheme is a strong example of what can be achieved through close collaboration between parties and clear objectives."

What Role Did Advisors Play in This Bulk Annuity Buy-in?

The bulk annuity buy-in required complex navigation of an unusual liability profile. Lead advisor Aon worked alongside legal experts from Squire Patton Boggs to guide the Trustees through cashflow profiling and risk transfer. This collaborative approach ensured that the Elementis plc sponsor and the Trustee Board could reach a favorable outcome despite administrative constraints.

• Aon served as the lead risk transfer advisor.
• Aptia managed the scheme administration and data validation.
• Squire Patton Boggs provided essential legal counsel to the Trustee.

Leah Evans, Partner at Aon, added: "The unusual liability profile of the Scheme required in-depth considerations of scheme experience and cashflow profiles in order to complete a successful transaction."

How Does This Deal Support Future Pension Buyouts?

This transaction is designed to facilitate a smooth transition toward a potential future buyout. By utilizing Aviva's post-transaction expertise, which includes over 650 data cleansing exercises, the Scheme can ensure its data is verified and ready for long-term management. This data validation phase is critical for maintaining stakeholder confidence and operational flexibility.

Wai Wong, Secretary of the Elementis Group Pension Scheme, said: "Our focus now turns to the data validation phase and a comprehensive plan and strong project management will ensure we deliver for all our stakeholders."

FF NEWS TAKE:

This £300m deal highlights the growing sophistication of the bulk annuity buy-in market. Aviva’s use of an integrated Master Trust to handle AVCs shows a clear move toward holistic retirement solutions rather than just liability offloading. For the wider fintech and insurance industry, this demonstrates that pricing certainty tools like price locks are now mandatory for large-scale de-risking in volatile markets.