Melrose in talks to transfer one of GKN's pension schemes
Melrose Industries
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13:34 19/04/24
Turnaround specialist Melrose is studying offloading the smaller of engineer GKN's two retirement schemes, with liabilities of close to £500.0m, to an insurer.
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Citing sources close to the situation, Sky News reported that talks with various insurers, including Aviva and Scottish Widows, had been ongoing for several weeks now.
Significantly, Melrose told Sky that it would follow-through on a previous pledge to inject £1.0bn into the two schemes regardless of "any other measures" such as a possible buyout by a specialist provider, which it said would enhance the pensioner covenant.
Such a transaction, known as a 'pension risk transfer', have been used in recent years by the likes of Rolls Royce, EMI and WPP.
GKN's two schemes pension schemes have approximately 32,000 members.
Rothschild and Jefferies had reportedly won the mandate to handle the process.