Co-op prepares to offload £2bn pension liabilities

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Co-op Aviva pension scheme
The £2bn of liabilities from the Co-op's PACE pension scheme will mean the mutual receives regular payments from Aviva and PIC to fund the relevant liabilities
// Co-op Group close to striking deals to offload around £2bn of its pension liabilities
// It is close to deals with Aviva & PIC to take on about a quarter of its £8bn PACE pension scheme

The Co-op Group is reportedly close to deals with Aviva and PIC to take on about a quarter of its £8 billion PACE pension scheme.

The group has said it is close to striking deals to offload around £2 billion of its pension liabilities to insurance companies, Sky News reported.

The Co-op Group, which includes supermarkets and funeralcare, is close to separate deals worth roughly £1 billion each with Aviva and Pension Insurance Corporation (PIC).


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The transaction with Aviva could be made public as soon as Wednesday, according to Sky News, while the agreement with PIC was likely to take slightly longer to finalise.

The £2 billion of liabilities from the Co-op’s PACE pension scheme will mean the mutual receives regular payments from Aviva and PIC to fund the relevant liabilities.

About half of the £8 billion scheme – which is fully funded and at the last actuarial valuation – had an accounting surplus of £1.8 billion, and supports pensions being paid to retired members.

Moreover, Aviva is also in talks about a deal to insure Debenhams‘ executive pension scheme, which holds more than £200 million assets.

The deal, which could be confirmed within a matter of weeks, will guarantee future benefits to members of its pension scheme.

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