Pensions Advisory in Restructuring and Insolvency Situations

Distressed employers have a number of options when it comes to their defined benefit pension obligations.

There have been a number of high profile cases in recent times where pension scheme liabilities have significantly and detrimentally affected the business (Tata, BHS, Caparo…), and independent research suggests the number of employers on the brink of insolvency with a pensions issue will only increase in future.

Employers are finding themselves in uncharted territory with tough and uncertain economic times.  Often business objectives are hindered by the pension scheme, and it is important to know that help is available to help navigate these unique circumstances.

Having a detailed understanding of the funding situation and options available is key.  Spence’s innovative and pragmatic approach focuses on three key areas to help identify and implement the best outcome for employers and scheme members before it is too late:

restructuring

 Contact Richard Smith for an initial discussion.

A wealth of pension insolvency and restructuring experience

We have a highly innovative and experienced team when it comes to supporting corporate entities and finding positive, pragmatic solutions for all parties concerned. Our specialist consultants have gained their experience through an ongoing and close working relationship with the PPF and over 20 years’ experience of working with a variety of employers across the economic spectrum. This market-leading insight makes us uniquely placed to help employers make the best of a tough difficult situation.

Streamlined with innovative scheme technology

Our multi award-winning software, Mantle, allows us to assess pension scheme liabilities in a dynamic way, adding real value.  We can examine the progression of pension scheme liabilities over of the full spectrum of future economic scenarios to provide valuable insight into the future viability of the employer, given their pension scheme obligations.  This insight can highlight some uncomfortable issues, however having the tools to address these as early as possible can ensure the maximum chance of finding a suitable solution that benefits all parties.

Our software can answer questions such as:

  • What is the chance of being 100% funded on a PPF basis in 10 years on the current contribution basis, and how should we invest our assets in order to optimise this likelihood?
  • What is the chance that contributions to fund the scheme will exceed £x in the next 10 years?
  • What cash injection would be required from the Company to ensure PPF benefits are always covered?

Our modelling capability allows us to put facts and figures to important questions which can add real value to corporate discussions.

ALM - Strategy Comparison
Full asset liability analysis on updated economic scenario data delivered quarterly.

Strong project management

Providing advice to employers in distressed situations is a very specialised area and, as each case is different, there is no ‘one size fits all’ solution. However, we have a tried and tested consulting process that delivers tangible results. When combined with our strong project management skills this approach dovetails well with any advice you may be receiving from other parties such as legal advisers and covenant assessors.

If you believe that you may benefit from having an initial discussion with an advisor please do not hesitate to contact Richard Smith, head of our corporate advisory practice.