Prime Highlights:
- Legal & General has completed a £4.6 billion pension buyout deal with Ford, one of the largest in the UK this year.
- The agreement strengthens L&G’s lead in the pension-risk transfer market, ensuring greater security for thousands of Ford retirees.
Key Facts:
- The deal covers the retirement savings of around 35,000 Ford employees and retirees across two UK pension schemes.
- L&G now has over £10 billion worth of UK pension-transfer deals completed or in exclusive talks for 2025.
Background:
Legal & General (L&G) has completed a £4.6 billion pension buyout deal with Ford, one of the biggest in the UK’s pension-risk transfer market this year. The agreement covers the retirement savings of about 35,000 Ford employees and retirees from two UK pension schemes, the Ford Hourly Paid Contributory Pension Fund and the Ford Salaried Contributory Pension Fund.
The deal boosts L&G’s position in the pension-risk transfer market, where companies pass their pension plans to insurers to make members’ retirement income more secure. Despite growing competition from North American investors, including Apollo and Brookfield, L&G continues to dominate this lucrative market segment.
Andrew Kail, Chief Executive Officer of Institutional Retirement at L&G, said the deal highlights the insurer’s ability to operate confidently amid fierce competition. “Pension-risk transfer is our biggest business, and it’s vital we continue to demonstrate our strength in this area,” he said.
The transaction provides Ford pension members with additional security, ensuring their retirement income remains protected regardless of future changes in the company’s financial situation. Jonathan Wood, Chair of the Board of Trustees for the Ford pensions, described the buyout as a “significant de-risking milestone” achieved after years of preparation.
Industry analysts estimate that UK companies will complete between £40 billion and £50 billion in PRT deals annually over the next five years. Although competition and tighter credit spreads may slightly reduce profitability, the overall outlook for the market remains strong.
The Ford transaction follows L&G’s recent partnership with Blackstone, through which the US investment firm will help source credit assets for L&G’s annuities business, a collaboration expected to reach up to $20 billion by the end of the decade.
With this latest buyout, L&G has now secured or is in exclusive talks for more than £10 billion in pension-transfer deals this year, solidifying its leadership in one of the UK’s most vital financial sectors.
