23rd Oct 2014 08:10
LONDON (Alliance News) - Education and IT resources company RM PLC on Thursday saw it shares boosted in early trade after it said it has entered into a pension buy-in deal with Pension Insurance Corp PLC.
RM said the deal between RM Pension Scheme Trustee Ltd and PIC will produce an income stream for the scheme which closely matches payments to all the 165 existing pensioners in the scheme.
It said the deal would largely eliminate the inflation, interest-rate and longevity risks associated with these pension benefits.
The insurance premium payable under the buy-in is GBP30.7 million, to be funded with GBP26 million in assets from the scheme and GBP4.7 million paid from an Escrow account funded by RM.
"Following this buy-in, approximately 13% of the Scheme's total liabilities are now insured. The buy-in is in line with RM's strategy of seeking to reduce the risks associated with the RM Education Limited's legacy pension scheme," said RM Chief Financial Officer Iain McIntosh.
RM shares were among the best performers in the FTSE Allshare index on Thursday morning, rising 2.5% to 144.75 pence.
By Sam Unsted; [email protected]; @SamUAtAlliance
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