A team of legal experts from international law firm, Gowling WLG, has advised Rothesay Life, one of the UK's largest pension insurers, on a bulk annuity transaction under which Rothesay Life insured just under £930m of deferred and pensioner liabilities in the Littlewoods Pensions Scheme (the "Scheme"). This is Rothesay Life's largest full scheme transaction of 2020.
The transaction covers the Scheme's remaining 6,454 uninsured members and includes residual risk cover. The Scheme had previously completed a £880m pensioner buy-in with Scottish Widows in 2018 and already benefited from a de-risked funding position. It was, therefore, in an ideal position to take advantage of attractive pricing opportunities caused in part by COVID-19.
The Gowling WLG team was led by Stephen Longfellow and Paul Feathers. Stephen negotiated the contract for Rothesay Life, with assistance from Dhruv Chhatralia. Sara Chambers and Jane Morrott assisted with the due diligence on the Scheme to ensure that Rothesay Life fully understood the risks they were insuring.
Gowling WLG has a longstanding advisor relationship with Rothesay Life, having advised them on a number of high-value pension risk transfer transactions in recent years.
Commenting, Stephen Longfellow who is a legal director at Gowling WLG, said:
"We're very pleased to have been able to help Rothesay Life and the Trustees secure the benefits of the Scheme's remaining uninsured members. It was a fantastic achievement by all involved, particularly given the challenges presented by the current circumstances, and it is always a pleasure to work with the Rothesay Life team."
Stephen also recently wrote an article on residual risk transactions for Rothesay Life's insights publication, The Journey to Buy-out.
Sammy Cooper-Smith, Head of Business Development at Rothesay Life, said:
"Between them, Steve and Paul have advised us on almost all of our residual risks transactions to date and their detailed knowledge of our business (particularly through Steve's time on secondment with us) and the market as a whole meant that this potentially challenging trade was completed smoothly and to a tight deadline. Steve led the Gowling team on this transaction and, once again, the Gowling team did a fantastic job."