Smiths Group extends pension de-risking with £130m buy-in

1st Feb 2017 08:02

(ShareCast News) - FTSE 100 engineer Smiths Group said on Wednesday that the trustee of the TI Group pension scheme has entered into a bulk annuity buy-in agreement with specialist insurer of defined benefit pension funds Pension Insurance Corporation.The buy-in policy covers liabilities totalling £130m relating to around 1,500 legacy scheme pensioners and dependents. Through a series of buy-ins, around £1bn of the TI Scheme liabilities has now been insured, Smiths said.Chief financial officer Chris O'Shea said: "Working closely with the scheme trustee, we continue to make progress in de-risking our pension liabilities. With today's announcement, we are creating an ever more effective hedge in the TI Scheme against the impact of changes in inflation, interest rates, duration and mortality assumptions."Our sustained focus, over many years, on de-risking the company's pension liabilities has reduced funding volatility and has led to significantly lower funding obligations going forward - freeing up capital for Smiths to invest in growth opportunities. Over 90% of the group's total pension liabilities are hedged through our liability driven investment strategy."