Harrods: There is only one pension-fund sale
Sunday 29 November 2009
Harrods, the upmarket London retailer owned by Mohamed al-Fayed, is mulling the sale of its £200 million pension fund in a buy-out deal.
Harrods is thought to be seeking to offload its pension obligations to more than 1,000 staff by selling the scheme to a specialist insurer. A so-called buy-in deal, where certain liabilities are insured rather than sold, is also being discussed.
The company recently brought forward the review of its pension fund to consider future funding options.
A spokesman for Harrods said: “Harrods is carrying out a statutory valuation of the fund, which is normal practice every three years. However, we are bringing this forward a little to make sure the company and the pension fund is protected. We are looking at a range of options for the fund.”
Harrods is believed to be in discussions with a number of firms to take over the running of the pension fund, including Edmund Truell’s Pension Corporation. A spokesman for Pension Corporation declined to comment.
The pension fund was nearly £20m in deficit at the end of January this year, according to accounts filed at Companies House in the summer, however, the shortfall is likely to have reduced as equity markets rallied from March.
In 2006, Harrods axed its final-salary pension scheme to new entrants, instead offering staff access to a less generous money-purchase scheme. At the time, the pension fund carried a deficit of around £106m, with the company saying the open scheme “presented an unacceptable future risk for its employees and the group”.
But in April 2006, Harrods committed to plug the shortfall by injecting £90m into the fund by 2016.
Should Harrods strike a deal on its pension fund it would signal the re-emergence of the pension buyout market, which has been largely closed during the past 12 months.
But recently the market has showed signs of life when Lucida, the private equity-backed insurer led by former Prudential chief executive Jonathan Bloomer, agreed a deal to insure £500m of pension liabilities held by the trustees of the Merchant Navy Officers Pension Fund.
- 1 2015 General Election: Green party will not appear in TV debate alongside Ukip – says BBC
- 2 Kentucky gang rape: 15-year-old boy left in critical condition after sexual attack by group at party
- 3 Of course, teenage girls need role models – but not like beauty vlogger Zoella
- 4 North Korean officials 'publicly executed for watching South Korean soap operas'
- 5 Muslims, immigration and teenage pregnancy: British people are ignorant about almost everything
'Nasa Confirms Six Days of Darkness in December': No, they don't - it's a hoax
Canadian actor punched in face after 'Islamophobia' experiment goes wrong in wake of Ottawa shooting
Elizabeth Norment dead: House of Cards actress honoured by Kevin Spacey after she dies aged 61
Kentucky gang rape: 15-year-old boy left in critical condition after sexual attack by group at party
North Korean officials 'publicly executed for watching South Korean soap operas'
Pope Francis declares evolution and Big Bang theory are real and God is not 'a magician with a magic wand'
Huge surge in Ukip support after EU funding row, according to new poll
Ukip ‘exploiting grooming scandal’ to secure party’s first police chief
Nigel Farage: 'There’s nothing wrong with white people blacking up'
Muslims, immigration and teenage pregnancy: British people are ignorant about almost everything
Nigel Farage and Frankie Boyle clash over Andrew Lawrence's 'Mock the Week' criticism
iJobs Money & Business
£20000 - £23250 Per Annum pro rata: Clearwater People Solutions Ltd: Pro rata ...
£40 - 48k + Benefits: Guru Careers: We are seeking a Marketing Manager to join...
£45,000 - £65,000: Saxton Leigh: Our client is a well-known APAC Corporate and...
£60000 per annum: Ashdown Group: Compensation and Benefits Manager - Compensat...