Morneau Shepell and Sun Life announce a $560 million pension risk transfer from Iron Ore Company of Canada
Largest same-day single insurer group annuity in Canadian history
TORONTO, Jan. 16, 2020 /CNW/ - Morneau Shepell, a leader in pension risk management in Canada, advised Iron Ore Company of Canada ("IOC"), a majority owned subsidiary of Rio Tinto, in its capacity as Plan administrator of its pension plan, on the execution of a buy-in group annuity purchase with Sun Life.
The deal, valued at more than CAD $560 million covers more than 3,700 retirees and beneficiaries, helps reduce risks associated with the pension plan and secures the plan's strong financial position. Sun Life was awarded the buy-in group annuity contract following a thorough due diligence process. This transaction represents the largest same-day transaction in the Canadian market to be placed with a single insurer. There will be no change for members, who will continue to be paid from the plan as before the transaction.
Morneau Shepell worked closely with IOC on the development of the de-risking plan aimed at producing a favorable outcome for all plan members and the plan sponsor. "Our unique bid process produced a great outcome for IOC and Sun Life," says Benoît Labrosse, vice president, Morneau Shepell Asset & Risk Management. "Our process ensures that insurers can deploy significant resources on an opportunity with the confidence that the Plan administrator will transact."
"A transaction of this size and scale demonstrates Sun Life's unique ability to help Canadian employers reduce their pension risk and provide long-term protection for their retirees," says Brent Simmons, Senior Managing Director & Head, Defined Benefit Solutions, Sun Life. "We were thrilled to work with IOC and Morneau Shepell to create such a meaningful and historic transaction. We continue to see these transactions grow in the Canadian market as companies look for better pension risk management solutions so they can focus on their core business."
About Morneau Shepell
Morneau Shepell is the leading provider of technology-enabled HR services that delivers an integrated approach to well-being through our cloud-based platform. Our focus is providing everything our clients need to support the mental, physical, social and financial well-being of their people. By improving lives, we improve business. Our approach spans services in employee and family assistance, health and wellness, recognition, pension and benefits administration, retirement and benefits consulting and actuarial and investment services. Morneau Shepell employs approximately 6,000 employees who work with some 24,000 client organizations that use our services in 162 countries. Morneau Shepell is a publicly traded company on the Toronto Stock Exchange (TSX: MSI). For more information, visit morneaushepell.com.
Morneau Shepell's Asset and Risk Management practice, part of the Retirement Solutions line of business, has been providing investment consulting services to clients for more than 40 years, spanning investment strategy, asset allocation, investment manager selection and performance monitoring. Through the Asset and Risk Management practice, the company has also become an industry leader in pension risk management and pension risk transfer consulting.
About Sun Life
Sun Life is a leading international financial services organization providing insurance, wealth and asset management solutions to individual and corporate Clients. Sun Life has operations in a number of markets worldwide, including Canada, the United States, the United Kingdom, Ireland, Hong Kong, the Philippines, Japan, Indonesia, India, China, Australia, Singapore, Vietnam, Malaysia and Bermuda. As of September 30, 2019, Sun Life had total assets under management of $1,063 billion. For more information, please visit www.sunlife.com. Sun Life Financial Inc. trades on the Toronto (TSX), New York (NYSE) and Philippine (PSE) stock exchanges under the ticker symbol SLF.
Sun Life's Defined Benefit Solutions is a team of experienced pension and investment professionals, whose mandate is to help Canadian companies manage the risks of their defined benefit pension plans. The team works closely with plan sponsors, consultants and other industry experts to deliver innovative and customized solutions.
IOC is a major North American producer and supplier of premium iron ore pellets and high-grade concentrate. IOC operates a mine, a concentrator and a pellet plant in Labrador City, in the province of Newfoundland and Labrador. IOC also operates a fully-owned 418-km-long railway, the QNS&L railway, which links the company's Labrador operations to its port terminal in Sept-Iles.
Note to Editors: All figures in Canadian dollars except as otherwise noted.
SOURCE Morneau Shepell - Corporate