Arcadia pensions secured in £850m deal with Aviva

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Members of bust fashion giant Arcadia Group pension schemes have had their benefits secured following a deal between trustees and insurance and pensions giant Aviva.

A buy-in with Aviva has safeguarded the benefits for 8,800 members of the Arcadia Group and Arcadia Group senior executive schemes, bringing an initial premium payment of £850m.

Arcadia, owned at the time by tycoon Sir Philip Green and comprising businesses including Topshop and Burton, collapsed in November 2020. The schemes then entered a Pension Protection Fund (PPF) “assessment period”.

Under the new deal, Aviva will provide members of the Arcadia Group pension scheme with “the full scheme benefits that they would have been entitled to if the insolvency and PPF assessment period had not taken place”.

Arcadia Group senior executive pension scheme benefits have been “secured at the level they would have been in 2022 if the insolvency and PPF assessment period had not happened”.

Work is being undertaken to “determine the future level of pension increases for members of the Arcadia Group senior executive pension scheme”.

Alda Andreotti, chair of trustees of the Arcadia Group pension scheme, said: “This is a positive development for members, securing their benefits for the long term. Members will receive benefits based on their Arcadia scheme pension, rather than receiving compensation from the PPF.

”This transaction is the result of our commitment to achieving the best outcome for members and I would like to thank all parties who collaborated with us. This includes our professional advisers, the Pensions Regulator and the PPF who have offered their guidance, support and reassuring protection to the schemes during these challenging times.

“The trustees are extremely pleased with this substantial development and we have already updated members directly on what the buy-in means for them. Our hard work will now continue to maximize the benefits for all members and prepare the schemes for buy-out.”

Aviva head of bulk purchase annuity origination Jamie Cole said: “The trustees’ goal of securing the best outcome for members and strong collaboration between parties helped achieve a smooth transaction.”

PPF relationship manager Dan Collins said: “Our role is to provide reassurance and support to the members of the schemes we protect at a worrying time, and it is great to see such a positive outcome. Arcadia members can be assured of our continued support throughout this transition phase.”

The Arcadia trustees were advised by Barnett Waddingham and Gowling WLG.