British Polythene scheme granted security ahead of company acquisition
The British Polythene Pension Scheme (BPPS) has been promised £3.8m per year in additional cash contributions until 2027 as its corporate sponsor is acquired.
The scheme will also benefit from a £40m security over company assets, reducing in value for each year of the additional contributions, as well as an additional company guarantee capped at £20m.
The pledges come as part of a memorandum of understanding between the scheme's trustees and Rome UK Bidco, which has made a cash offer for packaging company RPC Group at 782 pence per share.
The BPPS is one of the three schemes that would also feature in the takeover, which is expected to complete in the second quarter of the year; a further memorandum of understanding has been signed with the M&H Staff Pension Plan, while "advanced negotiations" are ongoing with the RPC Containers Limited Scheme.
RPC reported an unaudited, overall IAS 19 pension scheme deficit of £162.9m as of 30 September 2018. This had decreased from £192.9m as of 31 March, when it had £562.4m assets, and £755.3m liabilities.
The trustees of the BPPS said that, as a result of the information and mitigation provided, the acquisition is not believed to be materially detrimental to the security of members' benefits.
The company said a further announcement will be made as appropriate in relation to the RPC Containers Scheme.
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