Wyevale Garden Centres today announces that the Trustees for the company pension scheme have purchased a £44m bulk annuity policy from Aviva, the largest insurance company in the UK.
Against the backdrop of the sale of all Wyevale Garden Centres over the last 16 months, and the general risks of long term defined benefit pension provision, Wyevale Garden Centres has worked collaboratively with the trustees to secure the purchase of the bulk annuity policy. This policy is contracted with the trustees and together with the other assets held by the pension scheme, is completely separate from the company assets.
This positive development significantly increases the security of all member benefits and paves the way for a full ‘buy out’, which would result in the purchase of individual annuity policies for each member, further securing their benefits.
Wyevale Garden Centres has historically made regular contributions into the scheme and during 2019 has made significant lump sum contributions, totalling £16.5m, which has enabled the Trustees to purchase this bulk annuity policy.
Each member will receive a communication today, advising them of this positive development and confirming that there will be no change to their benefits with pensions continuing to be paid from the scheme in the same way as they are now.
The company was advised by LCP, which acted as lead transaction adviser on the deal.
Anthony Jones, COO of Wyevale Garden Centres said: “I am delighted that our successful sale process has put us in a position to provide £16.5m of additional funding to the pension scheme and has facilitated the Pension Trustees purchasing of a bulk annuity policy from Aviva, a leading provider. This development significantly increases the security of the long term benefits that the scheme offers to members. We have also ring-fenced the further funds required to continue this process and purchase individual annuity policies for each and every member of the scheme.”
Justin King, Executive Chairman of Wyevale Garden Centres said: “When we launched the sale process, our main goal was to secure a positive outcome for all stakeholders. This purchase of the Aviva policy represents an extremely successful outcome for the pension scheme and I am delighted that we have been able to facilitate this result for all of its members.”
Claire Teagle, Director HR Trustees Ltd and Chair of Wyevale Garden Centres Limited Pension Trustees said: "The Trustees have engaged closely with the Company over the past year with the aim of improving the security of members' benefits as the sale process has progressed. The trustees are delighted with the outcome which the additional funding has provided to secure members' full benefits with an Insurance Company."
Jamie Cole, Deal Management Lead of Aviva said: “We’re delighted to have been selected as the provider for this scheme. Working to clearly defined requirements, set by LCP, made it easy for us to work towards the best solution for the scheme and members. In a year that has seen a record-breaking volume of transactions, this highlights Aviva’s ability to offer competitive pricing and service schemes of all sizes in the market.”