Herbert Smith Freehills has advised longstanding client Pension Insurance Corporation (PIC), a specialist insurer of defined benefit pension funds, on its circa £2.4 billion all-risks pension insurance buy-out with the Trustees of the Philips UK Pension Fund (Philips), a diversified health and well-being company. This is the largest full pension insurance buyout in the UK to date.

The Herbert Smith Freehills Pensions team was led by partner and global head of Employment, Pensions and Incentives, Alison Brown, alongside senior associate, Rachel Pinto. Herbert Smith Freehills was able to deliver this transaction in the exceptionally short timetable by deploying a cross-office team drawing on Finance partner Kristen Roberts, and Insurance partner Geoff Maddock together with other specialist lawyers across the firm.

Alison Brown commented: "This buy-out is part of a continuing trend of pension schemes and their employers going to the insurance market to secure scheme liabilities on an all risks basis.

This was an extremely complex, ground-breaking transaction and stands as a significant undertaking in monetary value.  It covered the pension benefits of around 26,000 UK pension scheme members.  We are pleased to continue our track record in de-risking solutions, and to represent PIC in this important transaction."

Legal adviser to Philips was Slaughter & May, and the Trustees were advised by Wragge Lawrence Graham & Co.

Herbert Smith Freehills has worked on a number of high profile buy-ins, buyouts and longevity swaps. The firm previously advised PIC on the pension insurance buyout of the EMI group pension fund, which was a liability of Citigroup. The transaction covered £1.5 billion of liabilities and 20,000 members, and was at the time, the UK's largest ever pension insurance buyout.