Pension Corporation

Pension Corporation, a leading provider of risk management solutions to defined benefit pension funds, today announces that Pension Insurance Corporation has agreed with Alliance Boots to insure the Alliance UniChem UK Group Pension Scheme for its 3,000 members in a pension insurance buyout. This is the smaller of Alliance Boots’ principal UK pension schemes.

David Collinson, head of origination, Pension Insurance Corporation, said:

“I am delighted that we were able to help the trustees and sponsor of the pension fund bring safety and security to member benefits. We were impressed by the high quality of advisers, including Towers Watson as advisers to the sponsor, and Mercer as advisers to the trustees. This was a complex transaction in which PIC was able to make use of the unusual conditions in the gilt and swap markets to provide the client with a very compelling price that was able to be effected through a single insurance contract guaranteeing the members’ pensions. Having had discussions with other pension funds along similar lines, we expect to see more of this type of transaction.”

For further information:

Pension Corporation
Jeremy Apfel
+44 (0)20 7105 2140

Financial Dynamics
Rob Bailhache
+44 (0)20 7269 7200

Keren Perrott
+44 (0)20 7269 7218

About Pension Corporation

Pension Corporation is a leading provider of risk management solutions to the trustees and sponsors of defined benefit pension funds. Its FSA authorised and regulated insurance company, Pension Insurance Corporation (“PIC”), brings safety and security to scheme members’ benefits through innovative, tailored solutions. PIC has £4bn in assets under management and has insured 50,000 pension fund members. Its solutions include pension insurance buyout, pension insurance buy-in and longevity risk insurance. It has transacted both the UK’s largest and the first public sector backed pension insurance buyouts. Other clients include FTSE 100 companies and several multinationals. PIC is proud to work with pension fund trustees to maximise member benefits. For further information please visit www.pensioncorporation.com

About Alliance Boots

Alliance Boots is a leading international pharmacy-led health and beauty group offering a wide range of products and services to our customers working in close partnership with manufacturers and pharmacists. Our two core business activities are pharmacy-led health and beauty retailing and pharmaceutical wholesaling. Alliance Boots is privately-owned and employs over 115,000* people. Its wholesale and distribution network serves over 150,000* pharmacies, doctors, health centres and hospitals from over 360* pharmaceutical wholesale distribution centres in 16* countries. We operate more than 3,250* health and beauty retail stores in nine* countries, of which just under 3,150* have a pharmacy.

Pension Corporation, the leading provider of risk management solutions to defined benefit pension funds, has made a number of appointments to its client service team, which includes transition management and operations.

Recent joiners to Pension Corporation include Richard Hawke as head of transition programme management, Toby Gravett as PMO manager, Rupinder Eardley as senior transition manager and Jamie Dobbin as senior pensions administrator, all reporting to Matt Gore, head of operations.

Matt Gore, head of operations at Pension Corporation, said: “Pension Corporation works closely with trustees and sponsors to ensure that the transition process meets their objectives. At the same time we have a strong focus on providing the best possible service levels for our policy holders. These appointments will ensure we can continue helping trustees achieve their goals and reinforce the quality of the transition process for pension scheme members as well as their experience once they become our policy holders.”

Notes to Editors:

For further information please contact:

Pension Corporation
Jeremy Apfel
+44 (0)20 7105 2140

Financial Dynamics
Rob Bailhache
+44 (0)20 7269 7200

Keren Perrott
+44 (0)20 7269 7218

Caroline Parker
+44 (0)20 7269 7295

About Pension Corporation

Pension Corporation is a leading provider of risk management solutions to the trustees and sponsors of defined benefit pension funds. Its FSA authorised and regulated insurance company, Pension Insurance Corporation (“PIC”), brings safety and security to scheme members’ benefits through innovative, tailored solutions. PIC has over £3.5bn in assets under management and has insured c.50,000 pension fund members. Its solutions include pension insurance buyout, pension insurance buy-in and longevity risk insurance. It has transacted both the UK’s largest and the first public sector backed pension insurance buyouts. Other clients include FTSE 100 companies and several multinationals. PIC is proud to work with pension fund trustees to maximise member benefits. For further information please visit www.pensioncorporation.com

Barnett Waddingham, the leading independent firm of actuaries and consultants, and Pension Corporation, the leading provider of risk management solutions to defined benefit pension funds, today announce that the Trustees of the Alitalia Italian Airlines Pension and Assurance Scheme (“the scheme”) have entered into a pension insurance buy-in with Pension Insurance Corporation (“PIC”) to stabilise the scheme’s funding position. The scheme is currently within a PPF assessment period following the Administration of Alitalia (the sponsoring employer of the scheme) in 2008. At the time the company collapsed the Italian Government owned 49.9% of the shares.

The scheme is significantly underfunded with a s75 (or buy out) deficit in excess of £22million making it essential for the Trustees to take steps to protect the current funding level. The Trustees are making every effort to recover the deficit from Alitalia's Administrators in Italy.

The scheme will transfer circa £53m of assets to PIC to secure its current funding position and provide a facility to improve and secure further funds if available in the future.

A pension insurance buy-in is a key step towards fully de-risking a pension scheme by reducing the overall level of pension risk and investment volatility.

Miles Buckinghamshire, of BESTrustees and Chairman of Trustees, said:

“With pragmatic advice from Barnett Waddingham, we are delighted to have entered into this innovative arrangement with PIC. It has allowed us to lock down our asset and liability position in volatile markets to the benefit of our members whilst we continue to vigorously pursue the Trustees' claim in the Italian Administration court proceedings in Rome”

Paul Jayson, Partner, Barnett Waddingham, said:

“This arrangement is a key step for the Trustees of the Alitalia scheme as they work their way through the PPF assessment period. We believe that this insurance policy reduces the risk to members’ benefits having captured a favourable position.”

Mitul Magudia, Pension Insurance Corporation, said:

“We’re pleased to have developed the right insurance solution for this situation. This builds upon our track record of offering bespoke solutions for trustees to help them secure member benefits for the long-term.”

For further information:

Barnett Waddingham
Paul Jayson
+44 (0)20 7776 2200

BESTrustees plc
Miles Buckinghamshire
+44 (0)20 7332 4100

Broadgate Mainland
Emma Murphy or Melanie Shelley
+44 (0)20 7776 0503

Pension Corporation
Jeremy Apfel
+44 (0)20 7105 2140

Financial Dynamics
Rob Bailhache
+44 (0)20 7269 7200

Keren Perrott
+44 (0)20 7269 7218

About Pension Corporation

Pension Corporation is a leading provider of risk management solutions to the trustees and sponsors of defined benefit pension funds. Its FSA authorised and regulated insurance company, Pension Insurance Corporation (“PIC”), brings safety and security to scheme members’ benefits through innovative, tailored solutions. PIC has over £3.5bn in assets under management and has insured c.50,000 pension fund members. Its solutions include pension insurance buyout, pension insurance buy-in and longevity risk insurance. It has transacted both the UK’s largest and the first public sector backed pension insurance buyouts. Other clients include FTSE 100 companies and several multinationals. PIC is proud to work with pension fund trustees to maximise member benefits. For further information please visit www.pensioncorporation.com

About Barnett Waddingham

Barnett Waddingham LLP is the UK’s largest independent firm of actuaries and consultants. The firm works with Corporates, Trustees and Individuals in both the private and public sector, offering clear advice and a full range of professional advice including trustee consulting, employer pensions advice, pension management and administration, investment strategy, public sector pensions, risk benefits, life and general insurance consulting as well as the provision of SIPPs, SASSs and specialist executive pension plans’.

The firm has grown steadily since its inception in 1989. There are currently 42 partners and over 450 staff, based in 7 locations around the UK (Amersham, Bromsgrove, Cheltenham, Glasgow, Leeds, Liverpool and London).

Barnett Waddingham is also the UK representative of NORACS (North American Actuarial Consulting Services) and EURACS (European Actuarial Consulting Services). For further information please visit www.barnett-waddingham.co.uk

About BESTrustees

BESTrustees is one of the UK's leading independent trustee companies. We combine the talents of experienced individuals, who are recognised leaders in the pensions industry, with the security of a strong, well-established corporate trustee, to offer a superior quality independent trustee service. Independent trusteeship is our sole business.

The Company, owned by its Directors and Executives, has grown since inception in 1992 to act as a trustee to over 130 defined benefit, career average and defined contribution schemes with over £60 billion in assets under management. Our schemes, looked after by our 22 professional staff, range from the very large to the small, reflecting the diverse nature of pension schemes in the UK.

For further information on BESTrustees plc please contact: www.bestrustees.co.uk

Pension funds, in some cases prompted by the corporate sponsor, have been increasingly looking at a range of risk transfer options during Q2 2010. Affordability has been hit by the double impact on pension fund deficits of the reversal in the effective doubling of long-dated real gilt yields which took place during Q1 2010, combined with the significant volatility in the equity markets.

Whilst overall affordability has gone down for most schemes, the levels of affordability for specific tranches of the pension scheme have remained constant – with older pensioners, which are often matched by gilts, being able to be insured for marginal cost over the scheme’s funding levels. This is according to Pension Insurance Corporation’s Q2 2010 Pension Risk Transfer Index, published today.

The 3 per cent fall in the FTSE 100 on 29 June 2010 demonstrates the volatility in the markets which has led schemes with significant equity holdings to accept that their funding position will remain volatile. Trustees are seeking to bolster funding positions but are not just focussed on increased cash contributions; some form of contingent assets are now becoming more widely used. This trend might well be extended to the use of these assets to finance future risk transfer transactions.

David Collinson, head of origination at Pension Insurance Corporation, said: “The increased numbers of trustee boards coming back to the market for full or indicative quotes, even where there is a slight deficit in the pension fund, demonstrates that the industry is becoming more risk averse, with heightened awareness around the weakness of the corporate covenant being one of the main factors in this trend.

“Sponsors are also having more influence over derisking initiatives, and in many cases are driving the agenda on these projects. The markets, and shareholders, want to see evidence that management have got pension risk under control, with a clear plan of action to sort out the problem.”

Notes to Editors:

For further information please contact:

Pension Corporation
Jeremy Apfel
+44 (0)20 7105 2140

Financial Dynamics
Rob Bailhache
+44 (0)20 7269 7200

Keren Perrott
+44 (0)20 7269 7218

Caroline Parker
+44 (0)20 7269 7295

About Pension Corporation

Pension Corporation is a leading provider of risk management solutions to the trustees and sponsors of defined benefit pension funds. It oversees pension fund liabilities of c.£7 billion and is affiliated to more than 100,000 pension scheme members or former members. Its FSA authorised and regulated insurance company, Pension Insurance Corporation (“PIC”), brings safety and security to scheme members’ benefits through innovative, tailored solutions. These include pension insurance buyout or buy-in and longevity risk management. It has transacted both the UK’s largest and the first public sector backed pension insurance buyouts. Other clients include FTSE 100 companies and several multinationals. PIC is proud to work with pension fund trustees to maximise member benefits. For further information please visit www.pensioncorporation.com

John Fitzpatrick and Philip Moore have recently resigned for personal reasons from their respective roles at Pension Corporation. John and his family are returning to the United States; Philip has completed the objectives of the Group Finance Partner role, for which he was originally recruited, and is seeking to pursue a range of interests. John remains with the company in a consultancy role, whilst Philip will remain with the company to ensure continuity in the role of Chief Risk Officer, a role which he has latterly been performing. We wish both Philip and John well in their future pursuits.

For further information:

Pension Corporation
Jeremy Apfel
+44 (0)20 7105 2140

Financial Dynamics
Rob Bailhache
+44 (0)20 7269 7200

Keren Perrott
+44 (0)20 7269 7218

About Pension Corporation

Pension Corporation is a leading provider of risk management solutions to the trustees and sponsors of defined benefit pension funds. It oversees pension fund liabilities of c.£6 billion and is affiliated to more than 100,000 pension scheme members or former members. Its FSA authorised and regulated insurance company, Pension Insurance Corporation (“PIC”), brings safety and security to scheme members’ benefits through innovative, tailored solutions. These include pension insurance buyout or buy-in and longevity risk management. It has transacted both the UK’s largest and the first public sector backed pension insurance buyouts. Other clients include FTSE 100 companies and several multinationals. PIC is proud to work with pension fund trustees to maximise member benefits. For further information please visit www.pensioncorporation.com

With pension reform high on the new Government's agenda, Pensionomics.com launches today, seizing the moment to help fuel the pensions debate. Launched as a resource for anyone wanting to contribute to the debate or research in this vital field, Pensionomics.com is a new website which provides easy, free and open access to industry-wide commentary and research on the pensions landscape in the UK and internationally.

The website will be a public forum, supporting debate in promotion of the core principles of efficiency, equity and sustainability in the provision of pensions in both the public and private sectors. Pensionomics is also tweeting: @Pensionomics.

The Trades Union Congress (TUC), Confederation of British Industry (CBI), Social Market Foundation, David Willetts MP and think tank Policy Exchange are amongst those to have spoken out on the pensions-related issues they feel the new government must address on Pensionomics.com. This includes arguments for raising the pension age, developing a proper strategy around low earners and dealing with the demographic challenges ahead.

Hosted Comment

David Willetts MP: “Traditional company pension schemes were a kind of contract between the generations and as that has broken down the challenge is to create new savings instruments that help people through the lifecycle, help younger people to start saving, and perhaps even once more spread the risk across the generations.”

Nigel Stanley, Trades Union Congress: “The easy way to give people better pensions is to raise the pension age, and distribute the same expenditure among fewer pensioners...But making them instead reliant on much meaner benefits for the unemployed, and the increasingly draconian regime that treats anyone without a job as a workshy scrounger hardly seems a social advance.”

Guy Bailey, CBI: “We…believe it is essential that, within its first months in office, the next government should establish an independent commission to investigate the true costs of public sector pensions, and to put forward principles for reform.”

Lawrence Kay, Policy Exchange: "The key pension policy challenge for the next government will be developing a proper strategy around low-earners…The central issue in this choice is whether the government wants to keep incentivising its staff to stay in the public sector by offering them generous pensions, or if it would prefer to risk more fluid staff movements by having total remuneration packages that are more up-front and akin to those offered in the private sector.”

Pensionomics.com aims to tackle a broad range of pension-related themes, including public policy; the role of capital markets; asset-liability management; state and private sector pensions; longevity; socio-political considerations; labour market issues and the economic history of pensions.

The website will link to Pensions Tomorrow, a research initiative devoted to pension and longevity at the London School of Economics, and will also include independent research and commentary from Pension Corporation’s Thought Leadership programme. Pension Corporation is the site sponsor and has paid for its development, but will have minimal editorial oversight.

Pensionomics.com currently hosts research topics including:

the ongoing impact of the credit crunch on the UK pensions landscape
international approaches to public sector pensions
the current distribution of tax relief
an analysis of the unfunded public sector pension liabilities and debt in the national accounts

“Pension Corporation has advocated a national debate for some time now on the future of pensions in this country. Although much is written about the cost of public sector pensions and the death of defined benefit, there is no real debate about what should be done. We have decided to help facilitate the debate through this independent website, which will be free to all users,” said Dr Bob Swarup, one of the lead contributors to Pensionomics.com and Partner, Pension Corporation.

“We intend Pensionomics.com to be a live forum for analysis and debate on the key pension issues, which ought to be addressed during this Parliament, from the challenges facing low earners but increasingly also those on above average incomes,” said Dr Frank Eich, Senior Economist, Pension Corporation. “We believe that Britain deserves a more efficient, equitable and sustainable pension system and that this cannot be achieved solely by moving to defined-contribution provision, but this is an issue that has all but been ignored to date.”

For further information:

Pension Corporation
Jeremy Apfel
+44 (0)20 7105 2140

Financial Dynamics
Rob Bailhache
+44 (0)20 7269 7200

Keren Perrott
+44 (0)20 7269 7218

About Pension Corporation

Pension Corporation is a leading provider of risk management solutions to the trustees and sponsors of defined benefit pension funds. It oversees pension fund liabilities of c.£6 billion and is affiliated to more than 100,000 pension scheme members or former members. Its FSA authorised and regulated insurance company, Pension Insurance Corporation (“PIC”), brings safety and security to scheme members’ benefits through innovative, tailored solutions. These include pension insurance buyout or buy-in and longevity risk management. It has transacted both the UK’s largest and the first public sector backed pension insurance buyouts. Other clients include FTSE 100 companies and several multinationals. PIC is proud to work with pension fund trustees to maximise member benefits. For further information please visit www.pensioncorporation.com

73% of UK pension fund trustees are planning to reduce their pension fund’s exposure to risk in the coming years, through a variety of strategies, according to data gathered in one of the largest independent studies yet conducted: “The Future of Pension Schemes”.

To date, 65% of trustees have taken steps to reduce risk: 28% having reduced their exposure to the equity markets; 25% having employed a liability driven investment strategy; and 8% having completed one or more pension insurance buy-ins or a buyout.

Looking at future liabilities, the study showed that 57% of trustees are considering a liability driven investment strategy, with 35% considering longevity insurance and 45% considering a buy-in or buyout. Overall the biggest barrier to reducing risk is cost with 65% citing this as an issue, which is perhaps why 53% of trustees want to prioritise funding any deficit.

The study, which ran from January to March 2010, is published by Pension Corporation, the leading provider of risk management solutions to defined benefit pension funds, in association with Engaged Investor, the trustee magazine.

David Collinson, head of origination, Pension Corporation, said: “This important study brought several key considerations to light, all of which will have a significant impact on the future of defined benefit pension funds in the UK. The study demonstrated that the fall of Lehman Brothers had a marked impact on the risk tolerance of pension fund trustees and we can see that the vast majority are now seeking to limit their exposure to risk.”

Bob Campion, Editor of Engaged Investor, said: “It is clear that our readers have a single goal: reducing risk in their pension fund. But their minds are open as to the best route, and most are actively exploring a wide range of options. One thing is sure: we can expect the occupational pensions landscape in the UK the change significantly in the next few years.”

For further information:

Pension Corporation
Jeremy Apfel
+44 (0)20 7105 2140

Financial Dynamics
Rob Bailhache
+44 (0)20 7269 7200

Keren Perrott
+44 (0)20 7269 7218

Engaged Investor
Bob Campion
+44 (0)20 7618 3485
bob.campion@nqsm.com

About the “Future of Pension Schemes” Trustee Survey

The study was conducted by readers of Engaged Investor’s magazine and website between January and March 2010. 243 lay trustees, consultants, pension managers and independent trustees took part. 58% were lay trustees, 17% pension managers and 15% professional consultants or independent trustees. 64% of respondents represent UK pension schemes with at least £100m in assets. Aggregate assets under management for all respondents is approximately £50bn.

The study can be downloaded for free at www.pensioncorporation.com

About Engaged Investor

Engaged Investor The Trustee Magazine, is the only magazine and website dedicated to the UK’s army of occupational pension fund trustees. Launched in 2004, the magazine has a readership of 8,100 pension trustees and 2,000 pension professionals. Engaged Investor runs two free conferences for trustees each year and holds the UK’s only Trustee Awards in July. www.engagedinvestor.co.uk

About Pension Corporation

Pension Corporation is a leading provider of risk management solutions to the trustees and sponsors of defined benefit pension funds. It oversees pension fund liabilities of c.£6 billion and is affiliated to more than 100,000 pension scheme members or former members. Its FSA authorised and regulated insurance company, Pension Insurance Corporation (“PIC”), brings safety and security to scheme members’ benefits through innovative, tailored solutions. These include pension insurance buyout or buy-in and longevity risk management. It has transacted both the UK’s largest and the first public sector backed pension insurance buyouts. Other clients include FTSE 100 companies and several multinationals. PIC is proud to work with pension fund trustees to maximise member benefits. For further information please visit www.pensioncorporation.com

62% of UK occupational pension fund trustees believe they should be paid due to the ever-increasing pensions expertise they are now required to have, according to one of the largest independent studies yet conducted.

The study covered 243 respondents - 142 lay trustees and 101 consultants, pension managers and independent trustees. 64% of the respondents represent UK defined benefit pension schemes with at least £100m in assets under management. Aggregate assets under management for all respondents are approximately £50 billion.

The “increasing pensions expertise required” was cited by 55% of respondents as the reason why trustees should be paid, with 17% claiming it was due to the “significant level of responsibility”, and 14% citing the “amount of unrecognised time spent”.

The study, which ran from January to March 2010, was carried out with the readers of Engaged Investor, the trustee magazine, in association with Pension Corporation, the leading provider of risk management solutions to defined benefit pension funds.

The Pensions Regulator’s “Trustee Knowledge & Understanding” guidance outlines the knowledge levels required of occupational pension fund trustees. The full version of the document lists 13 distinct areas of knowledge and 94 specific knowledge requirements.

In a similar study conducted by Engaged Investor magazine of its readers in February 2006, only 50% of respondents believed trustees should be paid.

“There is little doubt that trustees have become expected to understand pensions much more intimately in the last few years, mostly due to the requirements of the Pensions Regulator but also due to the development of the marketplace,” said Engaged Investor Editor Bob Campion. “It is about time this responsibility was recognised financially.”

David Collinson, head of origination, Pension Corporation, said: “Trustees have undoubtedly had an increasing series of responsibilities placed on them over the past few years, not least the obligation to understand all the de-risking options open to them. It is also vital for them to understand how these options might work, a significant additional area of complexity.”

“As professional trustees have become more commonplace on trustee boards, lay trustees feel they should be financially compensated for their increasing expertise; particularly in areas such as investment and actuarial valuations,” added Bob Campion. “The counter argument is typically that trustees should volunteer for the right reasons – not because they want the money. The other question is; who would pay them?”

For further information:

Pension Corporation
Jeremy Apfel
+44 (0)20 7105 2140

Financial Dynamics
Rob Bailhache
+44 (0)20 7269 7200

Keren Perrott
+44 (0)20 7269 7218

Engaged Investor
Bob Campion
+44 (0)20 7618 3485
+44 (0)7960 773039
bob.campion@nqsm.com

About the “Future of Pension Schemes” Trustee Survey

The study was conducted by readers of Engaged Investor’s magazine and website between January and March 2010. 243 lay trustees, consultants, pension managers and independent trustees took part. 58% were lay trustees, 17% pension managers, 15% professional consultants or independent trustees. 64% of respondents represent UK pension schemes with at least £100m in assets. Aggregated assets under management of all respondents was approximately £50bn.

More details of the survey will be released shortly.

About Engaged Investor

About Pension Corporation

Pension Corporation is a leading provider of risk management solutions to the trustees and sponsors of defined benefit pension funds. It oversees pension fund liabilities of c.£6 billion and is affiliated to more than 100,000 pension scheme members or former members. Its FSA authorised and regulated insurance company, Pension Insurance Corporation (“PIC”), brings safety and security to scheme members’ benefits through innovative, tailored solutions. These include pension insurance buyout or buy-in and longevity risk management. It has transacted both the UK’s largest and the first public sector backed pension insurance buyouts. Other clients include FTSE 100 companies and several multinationals. PIC is proud to work with pension fund trustees to maximise member benefits. For further information please visit www.pensioncorporation.com

The effective doubling of long-dated real gilt yields from ½% over inflation to 1% over the last three months has brought down UK pension scheme liabilities. Trustees will have accordingly seen deficits narrow by over £30 billion, according to Pension Corporation’s Q1 2010 Pension Risk Transfer Index, published today.

Pension Corporation, a leading provider of risk management solutions to defined benefit pension funds, estimates that every ½% rise in real gilt yields could lower liabilities by 7%. For those pension funds with valuations due in March 2010, and their sponsors, this may be good news. However, volatility remains and this trend may prove short-lived.

In contrast, those pension schemes with deficits based on valuations made at 31 March 2009, undoubtedly the worst time for valuations given the crash in asset values, will have difficult discussions with their sponsors regarding funding plans. They will also have to consider the strength of the corporate covenant against the requirement to close the deficit.

The forthcoming financial reporting season will be critical in this regard, as there can be a large gap between the liability that companies report in their accounts and the liability they are committed to funding. At times this gap can become so big as to make IAS 19 very unreliable as a basis for assessment of the company’s commitments.

In the public sector, local authorities will be constrained from passing on increased pension costs to the taxpayer, so may look to transfer risk in different ways.

Pension Corporation’s projection for the size of the pension risk transfer market during 2010 is £15–£20 billion, including a significant amount of longevity risk transfer. Insurance buy-ins and longevity insurance will be seen increasingly as an asset class by pension fund trustees.

David Collinson, partner at Pension Corporation, commented:

“The Lehman Brothers bankruptcy really brought home to many market participants the risks to which their investments were exposed. For the first time since then demand for risk transfer solutions increasingly matches affordability, primarily for partial solutions. We can therefore expect to see an increase in demand for pension risk transfer solutions during 2010.”

Notes to Editors:

For further information please contact:

Pension Corporation
Jeremy Apfel
+44 (0)20 7105 2140

Financial Dynamics
Rob Bailhache
+44 (0)20 7269 7200

Nick Henderson
+44 (0)20 7269 7114

Keren Perrott
+44 (0)20 7269 7218

About Pension Corporation

Pension Corporation is a leading provider of risk management solutions to the trustees and sponsors of defined benefit pension funds. Its FSA authorised and regulated insurance company, Pension Insurance Corporation (“PIC”), brings safety and security to scheme members’ benefits through innovative, tailored solutions. PIC has over £3bn in assets under management and has insured c.50,000 pension fund members. Its solutions include pension insurance buyout or buy-in and longevity risk management. It has transacted both the UK’s largest and the first public sector backed pension insurance buyouts. Other clients include FTSE 100 companies and several multinationals. PIC is proud to work with pension fund trustees to maximise member benefits. For further information please visit www.pensioncorporation.com

Aggregate Industries Limited (“the Company”) today announces that its two largest pension schemes have entered into insurance transactions to transfer risk to Pension Insurance Corporation (“PIC”), a leading provider of risk management solutions to defined benefit pension funds.

The two transactions are as follows:

A circa £210m insurance policy purchased by the Aggregate Industries Pension Plan to meet all future payments for pensions in payment as at 30th April 2009.
A circa £95m insurance policy purchased by the Foster Yeoman Retirement Plan 2000 to insure the benefits for all members. It is expected that in due course the Plan will be wound up removing any further obligation on the Company.

Lane Clark & Peacock LLP acted as lead adviser to the Company and the Trustees of the two pension schemes on the transactions.

Ian McGown, Head of Pensions and Benefits at Aggregate Industries, said:

“These transactions follow a wide-ranging review of the pension risks underwritten by Aggregate Industries and the options available to address them.

We are extremely pleased to have completed two complex transactions simultaneously and in such a short period. Pension Insurance Corporation's tailored solutions and competitive financial propositions ensured they were selected ahead of several other insurers.

These transactions were made possible by close co-operation between the Company, Trustees and professional advisers, working towards agreed objectives. It involved a thorough selection, due diligence and negotiation process, leading to commercial terms which made the transactions attractive to both the Company and the Trustee. The transactions bring further increased security to members’ benefits for the long-term.”

Michael Berg, Partner at Lane Clark & Peacock LLP, said:

“We are delighted to have advised Aggregate Industries and the Trustees of both pension schemes and helped them achieve a fundamental reduction in the levels of pension risk.

Setting up a framework for monitoring de-risking opportunities allowed the schemes to move quickly once market conditions had improved, and to lock in to favourable pricing.

We are working with a number of pension schemes and companies to explore de-risking transactions and expect 2010 to be a very successful year for the pensions risk transfer market.”

John Coomber, Chief Executive, Pension Insurance Corporation, commented:

“I am delighted that we have been able to help the Trustees and sponsor bring security to the pension schemes’ members’ benefits in what was a complex transaction. The Trustees’ ability to move quickly, with the key support of LCP and the sponsor, was of critical importance in transferring risk, given recent volatility in the markets.

Pension Insurance Corporation has had a strong start to the year, building on our leading market share for 2009, and I believe that 2010 will be a significant year for pension risk transfer transactions.”

For further information, please contact:

Lane Clark & Peacock LLP
Mark Roberts
+44 (0)20 7432 3096

Aggregate Industries Limited
Chris Higgs
+44 (0)1530 816671

Pension Insurance Corporation
Jeremy Apfel
+44 (0)20 7105 2140

Notes to editors:

Aggregate Industries

Aggregate Industries is a leading player in the construction industry, committed to creating a better built environment. The company produces and supplies a wide range of construction materials including aggregates, asphalt, ready mixed concrete and pre-cast concrete products. It also imports and supplies cementitious materials and offers a national road surfacing and contracting service.

Aggregate Industries’ expertise, capability and solutions-focused approach have made it the preferred partner on some of the UK’s largest construction projects. The company is a pioneer of best practice in sustainability. It was the first company to be certificated to BES 6001, The Framework Standard for the Responsible Sourcing of Construction Products, developed by the BRE (Building Research Establishment) and a founding member of the UK Green Building Council.

Aggregate Industries operates across the UK, Channel Islands and northern Europe, and is a member of the Holcim Group. For further information, please visit www.aggregate.com

Lane Clark & Peacock

Lane Clark & Peacock LLP (LCP) is one of the leading firms of consulting actuaries in Europe, with a wide range of clients including some of the largest global multinationals as well as a number of private equity houses, charities and unions.

Over the last three years, LCP has taken a lead-advisory role on 14 significant buy-in and buyout transactions.

The firm currently has 84 partners and over 500 staff based in offices in London, Winchester, Jersey, Brussels, Zurich, Basel, Utrecht and Dublin. For more information on LCP please visit www.lcp.uk.com

LCP is part of the Alexander Forbes group of companies which employs over 4,000 people internationally. For more information on Alexander Forbes and its insurance, risk and financial services, please visit the website at www.alexanderforbes.com

Pension Corporation

Pension Corporation is a leading provider of risk management solutions to the trustees and sponsors of defined benefit pension funds. It oversees pension fund liabilities of c.£6 billion and is affiliated to more than 100,000 pension scheme members or former members. Its FSA authorised and regulated insurance company, Pension Insurance Corporation (“PIC”), brings safety and security to scheme members’ benefits through innovative, tailored solutions. These include pension insurance buyout or buy-in and longevity risk management. It has transacted both the UK’s largest and the first public sector backed pension insurance buyouts. Other clients include FTSE 100 companies and several multinationals. PIC is proud to work with pension fund trustees to maximise member benefits. For further information please visit www.pensioncorporation.com