In its capacity as plan administrator, Morneau Shepell Ltd. purchased several buy-in annuity contracts for the Stelco Inc. pension plan in July.
The goals of the transaction are to preserve the favourable financial position of the plan, ensure fair treatment of all members and maximize benefit protection, said Morneau Shepell in a press release.
The Canada Life Assurance Co., Sun Life Assurance Co. of Canada, BMO Life Assurance Co. and the Co-operators Life Insurance Co. were all involved in the structure of the $885 million deal.
Read: Morneau Shepell appointed administrator of Stelco’s five DB pension plans
In total, the transaction covers 2,725 retirees and beneficiaries, deferred vested and active or suspended plan members.
“Our team re-engineered the structure of our pension risk transfer process and worked closely with insurers/reinsurers, which was a key differentiator for this transaction,” said Benoît Labrosse, vice-president of asset and risk management at Morneau Shepell. “In the past few years, the Canadian pension risk transfer market has evolved to make larger and more complex transactions possible for the benefits of our clients.”
Read: Buy-ins and boomerangs: A look at the trends in Canada’s annuity market