Pensions Corporate Finance

Over the last decade, the decisions made on how to manage pensions risk have been material factors in creating (or eroding shareholder value).

Leaving pensions strategy in the hands of trustees and their advisors is too big a risk. In all other aspects of the sponsor’s business, it is the sponsor that drives their agenda – why not in defined benefit pensions?

Funding and journey planning

We support companies and their capital providers through triennial funding negotiations by working collaboratively with the trustees and their advisors to achieve appropriate and balanced funding outcomes for schemes which ensure that the agenda of the business and shareholders are also fairly considered.

To do this, sponsors need to be pro-active in setting out the true employer covenant story and ensuring that the capital and resource devoted to the scheme is correctly allocated given the competing demands of the business and the shareholders.

In some instances, where risk averse trustees seek injections of more capital into the scheme than may be required, we can help devise and implement tailored contingent asset and funding solutions which allow for an efficient allocation of capital while protecting the position of the scheme.

Part of this comes down to setting an appropriate journey plan for the scheme using best-practice Integrated Risk Management (IRM) to understand the sponsor’s risk capacity and risk appetite based on the sponsor’s agenda. Our partnership with Cardano means we can draw on expert investment advice to provide an integrated proposition to our corporate clients.

Corporate events

With the new Pension Schemes Bill enacted in 2021, corporates and their other stakeholders will need to be more thorough than ever before at the time of corporate activity in considering the position of the scheme. M&A, refinancing and restructurings must reflect the scheme as a material stakeholder and adequately mitigate any detriment caused.

Failing to do so brings risk of the costs and reputational damage of a regulatory intervention and the threat of criminal sanctions. Our advice can help corporates and their investors understand the pension dynamic and take the steps needed to protect their people and their organisations.

WEBINAR:
Register your interest for a webinar in March, where we’ll unpick what the Pension Schemes Act means for corporate entities and directors where they have a DB pension scheme. Email to register interest.

Why Lincoln Pensions?

Our corporate finance heritage means we are better placed than pure covenant and other practitioners to provide specialist insight and understanding of the corporate agenda. With the Big 4 often unable to act due to their conflicts of interest we are the clear market leader in this field.

Over the years we have advised many sponsors and worked collaboratively with trustees and other advisors to deliver better outcomes.

Please get in touch to find out how we can help you.

Related content:

The 2021 outlook for M&A activity
The 2021 outlook for restructuring

 

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