We have advised Marelli Automotive Systems UK Limited and Automotive Lighting UK Limited (“Marelli UK”) on a landmark, and industry first, six-scheme Clara-Pensions (“Clara”) superfund transaction.
Clara superfund transactions provide a material cost saving, and alternative to a full insurance buy-out for defined benefit (DB) pension schemes, while promoting the security of members’ benefits. In this case, under a single master agreement, six schemes, which together have 3,324 members and a combined value of approximately £250m, will transfer into one section of the Clara Pension Trust.
The six schemes range in size from approximately £1m to £125m, and each has its own membership profile, funding position and benefit or administration arrangements. A single structure brings all six schemes together in one section of the Clara Pension Trust, which allows the schemes to benefit from Clara’s economies of scale as a group, including the three smallest schemes, which would have been unlikely to access a superfund on their own.
For Marelli UK, (the sponsoring employer), the transaction provides certainty across all six schemes at a material cost saving. For members, the transfer promotes the security of their benefits.
The Burges Salmon team was led by Clive Pugh (Partner), supported by Mamunul Wahid, Crispin Freeman, Jack Gillions, Sarah Moody, Shakes Seebaluck and a significant number of lawyers from Burges Salmon’s 65-person dedicated pensions team. Marelli UK was also advised by BDO, the trustees by Lane Clark & Peacock, Sackers and Squire Patton Boggs and Clara by CMS.
