Last checked at 19 Jul 2012 07:00
19 July 2012
COOKSON GROUP PENSION PLAN COMPLETES PENSIONER BUY-IN WITH PENSION INSURANCE CORPORATION
Cookson Group plc ("Cookson" or "the Company"), a leading materials science company, today announces that the Trustee of the Cookson Group Pension Plan ("the UK Plan") has signed a pension insurance buy-in agreement with Pension Insurance Corporation ("PIC"), a leading provider of pension insurance solutions to defined benefit pension funds. The transaction covers the UK Plan's pensioner liabilities, approximately 60% of the total liabilities, with an insurance premium of circa £320 million met from existing assets of the UK Plan.
De-risking the UK plan in this way, by removing the inflation, longevity and interest rate risks for the insured liabilities, will significantly reduce the level of volatility to which Cookson is exposed in future pension funding costs through its sponsorship of the UK Plan.
Mike Butterworth, Group Finance Director of Cookson Group plc, said:
"Following the successful conclusion of an enhanced transfer value offer earlier this year, which reduced significantly the UK Plan's deferred member liabilities, this buy-in represents a further demonstration of the Company's intention to work with the Trustee to de-risk the UK Plan in a managed way. The buy-in, which covers some 60% of the UK Plan's total liabilities, will help reduce the level of volatility in future funding costs to which the Company is exposed as the sponsor of the UK Plan."
Allan Course, Chairman of the Trustee, said:
"The Trustee has completed a pensioner buy-in following consultation with Cookson Group plc and with advice from Aon Hewitt. The buy-in means that the UK Plan is now fully protected against interest rate, inflation and longevity risks in relation to a significant proportion of its liabilities. This provides an additional level of security for members. We are delighted with the flexibility and responsiveness of the PIC team, as well as the support provided by Aon Hewitt and our other advisers, in bringing the transaction to a successful conclusion."
Jay Shah, co-Head of Business Origination, Pension Corporation, said:
"We are very pleased to have been able to help Cookson achieve their de-risking goals. Whilst pension scheme funding levels have generally been impacted by poor equity markets and low interest rates, the large number of pensioner buy-ins completed recently have been driven by the increase in value of Gilts and bonds, allowing those schemes whose liabilities are at least partly matched with these assets to insure significant levels of risk. This allows the company sponsors and their shareholders to lower their exposure to future pension scheme funding volatility."
For further information please contact:
Cookson Group plc: Mike Butterworth
+44 (0)20 7822 0000
Pension Corporation: Jeremy Apfel
+44 (0)20 7105 2140
apfel@pensioncorporation.com
Media enquiries: John Olsen, MHP Communications
+44 (0)20 3128 8100
About Cookson Group plc:
Cookson Group plc is a leading materials science company operating on a worldwide basis in supplying high performance, value-adding consumable materials and chemicals used in various industrial production processes.
The Engineered Ceramics (formerly Ceramics) division is the world leader in the supply of advanced consumable refractory products and systems to the global steel and foundry industries and a leading supplier of speciality products to the glass and solar industries.
The Performance Materials (formerly Electronics) division is a world leading supplier of advanced surface chemistries and joining technologies to the electronics, automotive and electroplating industries.
The Precious Metals Processing (formerly Precious Metals) division is a leading supplier of fabricated precious metals to the jewellery industry in the UK, France and Spain, and also has significant precious metals recycling operations.