Restructuring a business with a DB pension scheme is complex. It requires specialist expertise and up-to-date knowledge of the changing regulatory landscapes. We work with clients to deliver creative solutions which optimise outcomes for all stakeholders.
Whether you are a trustee, a CEO or financial stakeholder, restructuring situations can be difficult landscapes to navigate.
The position becomes even more complex where there is a UK DB Pension Scheme, which will almost invariably be impacted by a restructuring, whatever form it may take.
Trustees, corporates and other key stakeholders will often have to consider and assess options to manage and/or compromise pension scheme liabilities via a range of restructuring solutions.
At the very least, a restructuring or reorganisation will impact on the employer’s covenant and the stakeholders will need expert support to understand the extent of such an impact and how it might be mitigated.
In addition, the parties involved will need to understand the ‘moral hazard’ risks associated with restructuring plans, particularly if the outcome is likely to be highly adverse for the scheme.
Stakeholders should be aware of the potential use of the powers available to the Pensions Regulator (TPR), including the potential for the imposition of Contribution Notices, Financial Support Directions and/or Schedules of Contributions and their ‘reasonableness’. We have a deep understanding of TPR’s position in these situations and have worked closely with both the TPR and the Pension Protection Fund on numerous projects including acting as their expert).
We have experienced expert advisors who can guide stakeholders through these difficult situations, including:
- Corporate viability/solvency assessments
- Assisting boards and guiding them through the restructuring process
- Leading or providing expert advice and assistance in restructuring negotiations
- Undertaking or reviewing insolvency contingency planning
- Entity priority model analysis
- Assessments of the impact of reorganisations and restructurings on the pension scheme and its employer covenant, including potential mitigation that may be required to repair any detriment
- ‘Moral Hazard’ risk reviews, to consider the likelihood and potential impart of TPR intervention
- Supporting stakeholders in assessing options to compromise scheme benefits and separate the pension scheme from the sponsor
In May 2020 we were selected to be part of the Pension Protection Fund’s new Trustee and Support Services panel.
The panel enables trustees to get access to the right restructuring support and knowledge to advise them when scheme employers are facing financial distress and potentially an insolvency event (involving the PPF). The primary aim is to provide trustees with the restructuring expertise and experience to maximise the likelihood of delivering a viable employer and scheme at the end of the process. Find out more here.
We stand out from our competitors as we are pensions focused, independent and bring a market leading team with diverse experience to provide a more holistic view of any situation.