Melrose Industries's UK defined benefit (DB) schemes had a £5.5m combined deficit at the end of 2016, its annual results have revealed.
The Brush UK Plan, which closed to future accrual in 2011, was recorded as having an £8.3m accounting surplus as of 31 December, compared to a £17.1m surplus at the end of 2016.
It also recorded the Nortek UK scheme as having a £13.9m deficit as of the end of the year, compared to a £13.8m deficit a year prior.
Overall, the funding level of the schemes was 98%, with a combined deficit of £5.5m.
The company blamed market movements and changes in assumptions for the deficit, but said the Brush surplus was "good news for pensioners".
It added it had refocussed the Nortek trustees on a "more coherent investment strategy and a contribution scheduled designed to fully fund the scheme over the medium term", noting the scheme was "at the start of its journey" with the firm.
The deteriorating overall UK position came as the company continues to press ahead with plans for a £7.4bn hostile takeover of GKN Group, whose 32,000-member DB scheme has a much larger deficit of £1.1bn on a gilt-flat basis as of October.
The GKN trustees had warned Melrose that if its takeover bid was successful, it expected "full engagement with management… to ensure satisfactory protection and mitigation for any impact". Meanwhile, GKN warned the takeover would have "implications for the covenant strength of the company".
But, in a letter published earlier this month, Melrose chairman Christopher Miller defended the firm's past record, noting it had improved the McKenchie DB scheme's funding position from 58% to fully-funded, and Nortek scheme, acquired in 2016, was also "well-funded".
The company has previously promised to put £150m into GKN's pension schemes within 12 months of the completion of its offer.
Melrose also sponsors DB schemes in the US and had an overall deficit figure of £17.6m, almost half the £33.4m figure recorded at the end of 2016.
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