Hogan Lovells advises on the £340 million buy-in between Cable and Wireless Superannuation Fund and the Legal & General Assurance Society Limited

The sponsoring company, Cable and Wireless Limited (“the Sponsor”), is part of Liberty Latin America, a provider of telecommunications services in more than 20 countries. The Fund is a long-standing client of Legal & General Investment Management (“LGIM”) and is an existing policyholder of Legal & General. 

This buy-in marks the Fund’s third and final transaction with Legal & General, following buy-ins in 2017 and 2019. 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.   

Partner at Hogan Lovells Claire Southern commented: “The Trustee is a longstanding client of the firm and we are pleased to have provided expertise that ensured all member benefits are now fully backed by a UK insurer. This is a great outcome for all parties.”

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.” 

Commenting on the buy-in, Dean Johnson, Trustee Director said: “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.” 

“We have fully supported the Trustee in this process and are delighted the Fund has reached the stage where all member benefits are insured,” commented Matt Read, Treasurer at Liberty Latin America. “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 said: “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. 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.”