{"id":243161,"date":"2025-10-27T01:55:06","date_gmt":"2025-10-27T01:55:06","guid":{"rendered":"https:\/\/www.newsbeep.com\/au\/243161\/"},"modified":"2025-10-27T01:55:06","modified_gmt":"2025-10-27T01:55:06","slug":"legal-general-agrees-4-6bn-uk-pensions-buyout-deal-with-ford","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/au\/243161\/","title":{"rendered":"Legal & General agrees \u00a34.6bn UK pensions buyout deal with Ford"},"content":{"rendered":"

Stay informed with free updates<\/p>\n

Simply sign up to the Workplace pensions myFT Digest — delivered directly to your inbox.<\/p>\n

Legal & General has struck a deal to take over billions of pounds of pension liabilities from Ford, as the insurer seeks to reinforce its dominant position in the UK\u2019s increasingly competitive pension buyout market.<\/p>\n

The \u00a34.6bn deal will cover the retirement savings of 35,000 people and has put L&G on course to achieve the highest value of deals this year, despite the arrival of North American players forcing more aggressive pricing. <\/p>\n

The UK\u2019s pension-risk transfer market, in which companies pay insurers to take on their financial obligations to retirees, drives the majority of L&G\u2019s group revenue and has attracted private capital giants<\/a> Apollo and Brookfield Asset Management. <\/p>\n

\u201cPension-risk transfer is our biggest business\u2009.\u2009.\u2009.\u2009it\u2019s really important to us to show that we can operate in what is a very competitive market to secure this\u201d Andrew Kail, chief executive officer of institutional retirement at L&G, told the Financial Times.\u00a0<\/p>\n

The deal with the US carmaker was spread across two of Ford\u2019s UK pension schemes \u2014 the Ford Hourly Paid Contributory Pension Fund and the Ford Salaried Contributory Pension Fund. Such deals benefit retirees through greater security of their retirement income even if their former employer runs into financial difficulty.<\/p>\n

Jonathan Wood, chair of the board of trustees for the Ford pensions, said he was \u201cdelighted to have achieved this significant further de-risking milestone, providing even greater security for our members\u201d, having worked on the deal for \u201cmany years\u201d. <\/p>\n

Companies, including NatWest and Rolls-Royce, have sold part or all of their defined benefit schemes to insurers in record volumes in recent years as schemes\u2019 funding levels improved after a rapid rise in government borrowing costs reduced the value of future liabilities.\u00a0<\/p>\n

Meanwhile, the prospect of lucrative deals has drawn more players into the PRT market. Athora, an insurer backed by Apollo in July announced plans to buy Pensions Insurance Company, which was followed later that month by Brookfield agreeing a \u00a32.4bn deal<\/a> for life insurer Just Group.<\/p>\n

\"Bar<\/p>\n

That month, L&G also struck a private credit partnership <\/a>with Blackstone, in which the US alternative-assets group will source deals for the FTSE 100 company\u2019s annuities business. Blackstone said the partnership could be worth up to $20bn by the end of the decade.<\/p>\n

Kail said L&G did the transaction because \u201cthey have the ability to generate investment grade credit in the US better than we can and that\u2019s really important\u201d.\u00a0<\/p>\n

In addition to the Ford transaction, L&G has more than \u00a310bn worth of UK PRT transactions that have either been completed or are the subject of exclusive talks this year, slightly higher than analysts\u2019 forecasts.<\/p>\n

Consultants expect companies in the UK to conclude \u00a340bn to \u00a350bn in PRT transactions annually over the next five years, though ratings company Fitch said last month the value of deals this year could drop to about \u00a340bn, from \u00a348bn in 2024. <\/p>\n

That is partly owing to fewer large deals being concluded while stiffer competition and tight credit spreads \u2014 a narrow gap between corporate and government borrowing costs \u2014 has lowered the profits available to insurers on the transactions.<\/p>\n","protected":false},"excerpt":{"rendered":"Stay informed with free updates Simply sign up to the Workplace pensions myFT Digest — delivered directly to…\n","protected":false},"author":2,"featured_media":243162,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[14],"tags":[64,63,99,186,184,185],"class_list":{"0":"post-243161","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-personal-finance","8":"tag-au","9":"tag-australia","10":"tag-business","11":"tag-finance","12":"tag-personal-finance","13":"tag-personalfinance"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/243161","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/comments?post=243161"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/243161\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media\/243162"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media?parent=243161"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/categories?post=243161"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/tags?post=243161"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}