Oct 20 (Reuters) - Engineering company Smiths Group said on Friday it had agreed a deal to insure 207 million pounds ($271.38 million) of its pension scheme with Canada Life.
Under the so-called ‘buy-in bulk annuity’ deal, the insurer will take on some of the risk of the pension scheme, which remains with the company.
“Our sustained focus... on de-risking the company’s pension liabilities has reduced volatility and has led to significantly lower funding obligations going forward - freeing up capital for Smiths to invest in growth opportunities,” Chief Financial Officer Bill Seeger said.
Across Smiths Group’s two main UK schemes about 1.5 billion pounds ($1.97 billion) of liabilities have now been insured, it said.
Smiths Group is the latest of several British companies to announce bulk annuity deals which cut the risk of them struggling to fund their employees’ retirement schemes.
Publisher Pearson said on Tuesday it had agreed a deal to insure a third of its pension scheme liabilities totalling 1.2 billion pounds with Legal & General and Aviva. ($1 = 0.7627 pounds) (Reporting by Noor Zainab Hussain in Bengaluru; Editing by Rachel Armstrong)