UK - The Treasury Select Committee will today hear evidence from the pensions regulator David Norgrove as part of its inquiry into private equity.
The inquiry has been fuelled by recent private equity buyouts of Alliance Boots and J Sainsbury’s when the trustees got involved in the negotiations, as the pension funds were massively underfunded.
Commenting on the issue, pensions lawyer Adam Bushby from law firm LG, said there was essentially no quick fix under the law as it currently stands and the powers currently being exercised by the regulator meant members of schemes did not have any long term certainty over their pensions.
Bushby said: "The KKR Alliance Boots case is unusual in that the trustees threatened to try and derail the deal in court. They've used that to get the funding package they were looking for. There's nothing in the law requiring settlements to be reached at the time a deal is done. The only recourse could come via the pensions regulator but, so far, the regulator has proved reluctant to intervene overtly in such cases."
In a separate development, Unison has started a campaign to persuade more members to become pension trustees so they have more influence in companies' decisions when approached by private equity investors.
Unison's general secretary David Prentis reportedly said: “Concerns over corporate behaviour and asset stripping by private equity groups are strong arguments for greater shareholder scrutiny and empowerment.”
PP has analysed the accounts of the biggest pension consulting firms and recorded the turnover (revenue) in their most recent accounts. The full leaderboard is below…
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