The advent of the consolidator

The trustees of the Sears Retail Pension Scheme, which is worth £590m, have confirmed their decision to participate in the UK’s inaugural “superfund” or commercial consolidator transaction with Clara Pensions. This agreement, which was approved by The Pensions Regulator (TPR) on November 3, involves Clara providing an extra £30m in ring-fenced funding to bolster the 9,600-member scheme, thereby enhancing members’ security and facilitating the pension fund’s progression towards an insured buy-out within a time frame of five to ten years.

The trustees of Sears have informed the scheme’s members about their plans to transfer their pension benefits to the Clara Pensions Trust, with the transaction set to finalise by the end of this month following a mandatory 30-day notice period for members.

In their statement, the Sears Retail Pension Scheme’s trustees emphasized that Clara’s additional £30m funding as part of the transaction would aid in the successful buy-out of the scheme and enhance members’ security.

Clara Pensions CEO Simon True highlighted the significance of the day for Sears’ members, as they are the first to become members of Clara and will benefit from the immediate injection of an additional £30m in protected capital to support their progression towards an insurance buy-out. He further added that while insurance is the ideal standard for any pension scheme member, not all schemes can achieve this. Clara was established to offer a secure pathway that makes the insurance market accessible for more schemes and their members.

This deal marks the beginning of a seismic shift in the endgame landscape and pensions universe as a whole. It promises a new chapter of opportunity for smaller schemes wanting to secure pension promises and improve member outcomes and offers concrete evidence of the success of Clara’s superfund model. With Sears’ pension scheme leading the way, the prospect for other schemes – traditionally less attractive to insurers – to embark on a superfund endgame journey is more promising than ever, and as Clara continues to be proactive in the endgame space we look forward to seeing more deals in the future.

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