Marathon Service (G.B.) Limited Pension and Life Assurance Scheme completes £610m full buy-in with Rothesay Life

September 2020

Rothesay Life, one of the UK’s largest pension insurers, today announces that it has completed a £610m buy-in with the Marathon Service (G.B.) Limited Pension and Life Assurance Scheme (“the Scheme”).

The transaction was initiated by the Scheme’s sponsoring employer, RockRose Energy plc, who identified a pricing opportunity on the back of beneficial market movements arising from Covid-19 and then worked closely with the Trustees via a Joint Working Group to lock into pricing quickly. The agreement secures benefits in full for the 740 pensioners and 700 deferred members in the Scheme.

RockRose Energy plc is an independent oil and gas production and infrastructure company. Listed on the main market of the London Stock Exchange, it focuses on onshore and offshore production opportunities and infrastructure projects.

The transaction was led by LCP, acting for RockRose, with Sackers providing legal advice. The Trustees were advised by Mercer and Herbert Smith Freehills. Legal advice was provided to Rothesay Life by Gowlings.

Andrew Austin, Chair of RockRose said: “This transaction gives certainty for the members’ pensions with an experienced and financially strong provider. The secondary benefit is that it has capped the financial risk to the sponsor. We are grateful for the advice received from LCP that allowed us to be opportunistic and secure outcomes that mutually benefited both the pension scheme members and the sponsoring employer.”

Chris Martin, Chair of Trustees and Executive Chairman of ITS, said: “This transaction secures benefits in full for our members, ensuring a greatly enhanced level of security. We are delighted to have been able to secure this transaction in the current economic climate, which was only achieved by all parties working closely together.”

Tom Seecharan, Business Development at Rothesay Life said: “We are proud to have been chosen to provide security for the Scheme and to help another scheme on their journey to buyout, a trend we expect to continue over the coming year. It was clear throughout this process that the Scheme and RockRose were working together closely and had a genuine commitment to move quickly if that target could be hit. This was key for us to meet their challenging price target.”

Ken Hardman, Partner at LCP said: “We’re delighted to have been able to help secure the benefits in full for all the members of the Scheme. This transaction is a concrete example of identifying a market opportunity and being able to act quickly on it before market conditions revert.”

Martyn Philips, Principal in Mercer’s Risk Transfer team, said: “We are delighted to have supported the Trustees in ensuring the deal met their risk management objectives and delivered the best outcome for their members. Working closely with the Company and their advisers through the Joint Working Group demonstrated a cohesive approach, which in turn generated strong insurer engagement and led to good buy-in terms being secured.”

Read – “The journey to buy-out” – a thought-provoking series of articles, from host of industry experts, on what it takes to complete a full buy-out of pension fund liabilities.

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