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CMS advises Legal & General on c. £110m buy-in with the Civil Aviation Authority Pension Scheme

18 March 2021

International law firm CMS has advised Legal & General Assurance Society Limited (Legal & General) in relation to a c. £110 million buy-in transaction with the CAA Section of the Civil Aviation Authority Pension Scheme (the Scheme). 

This transaction marks the Scheme’s first pension risk transfer transaction with Legal & General and has been established as an umbrella contract to enable smooth facilitation of any future transactions. 

CMS assisted on the drafting and negotiation of the suite of transaction documents and provided advice throughout on pensions and risk transfer issues.  

Caroline Kurup, CMS Pensions Partner, said: “We are pleased to have supported our client Legal & General on this notable transaction. It is a great outcome for all parties involved and testament to the CMS Pensions team’s strengths in advising clients on risk transfer transactions.”

Gavin Smith, UK Head of Pricing and Execution, Legal & General Retirement Institutional, commented: “I am pleased we were able to secure the pension benefits for a long-standing Legal & General client. We look forward to working closely with the Civil Aviation Authority Pension Scheme Trustee as they continue to insure the Scheme’s remaining pension liabilities. Providing umbrella contract solutions enables pension schemes to continue moving effectively and strategically, to complete their de-risking journeys, when favourable conditions arise.”

The CMS team advising Legal & General comprised of Caroline Kurup and Elaine He, with support from Thomas Lockley. 

CMS has had a raft of successes in the pensions de-risking arena over the past 18 months, acting on eight out of the 10 buy-in/out deals over £1bn in 2019, six out of the eight longevity swap conversions that have taken place to date, and many of the large-scale longevity swaps in the market including advising Pacific Life Re on the £10bn transaction with the Lloyds Banking Group pension scheme, the conversion of LV=’s £800m longevity swap into a buy-in with Phoenix Life, the conversion of the MNOPF’s £1.6bn longevity swap into a buy-in with Pension Insurance Corporation and acting for a FTSE100 trustee on the first “Enhanced Pass-Through” transaction with Zurich and Hannover Re, covering approximately £800m of pensioner liabilities.

CMS has also been recognised as Law Firm of the Year at the UK Pension and Investment Provider Awards 2020 and Pensions Lawyers of the Year at the Professional Pensions UK Pensions Awards 2020. It was also named the top firm for Supporting Development at the Professional Pensions Rising Star Awards 2020, where the firm was commended for its well-rounded approach to the professional development of its lawyers.