CC, Bakers, Hammonds brought in for Denso pensions buyouts

Under advice from ­Hammonds partner Fraser Sparks, the schemes’ trustees, Capita, have agreed a buyout with Pension Insurance Corporation (PIC), a subsidiary of ­pension scheme consolidator Pension Corporation.

Under the terms of the deal, Pension Corporation, advised by ­Clifford Chance partner Nicholas Sherwin, has become the sponsoring employer of the schemes.

This has allowed DMML, which was advised by Baker & McKenzie partner ­Chantal Thompson, to remove the pension scheme liabilities from its balance sheet.

Capita also bought a bulk annuity contract from PIC to cover the schemes’ ­pensioners and deferred members, with total ­liabilities valued in excess of £100m.

Sparks said: “This was an extremely complex deal whereby the insurance ­company not only issued an all risks buy-in policy, but also took over as the ­sponsoring employer of the pension schemes.”

Pension scheme buyouts have risen in popularity over the past couple of years as companies look at ways of offloading the cost of ­funding deficits and ­meeting scheme liabilities.

A source close to the Capita deal said: “This is quite unusual and it can be costly, but there are great benefits. By purchasing all risk the winding up of the pension schemes takes a matter of weeks rather than years.”

This is the first major deal Hammonds’ pensions ­practice has advised on since losing London pensions head Jay Doraisamy earlier this year. Doraisamy left for partnership at Eversheds at the end of Hammonds’ lock-in period. A year ago Leeds pensions head Terry Saeedi also left for partnership at Eversheds.

Hammonds has since vowed to build up its pensions practice, promoting Birmingham-based Sarah Franklin and Manchester-based Charmian Johnson to the junior partnership ­earlier this year.

Clifford Chance and Baker & McKenzie were unavailable for comment.