Trustees of Premier Foods have scrapped plans to sell off the risk that members of its £2bn pension fund will live longer than planned in a so-called longevity swap deal.
The maker of Mr Kipling cakes had been looking to pass on the risk from the scheme's ageing membership to another insurer, but the listed group has since decided against the deal.
When Premier bought Rank Hovis McDougall in 2007, the firm promised to plug money into the £120m pension deficit, which it is believed has widened as stock markets have fallen. Sources close to Premier say that its finance director, Jim Smart, who joined the food group last year, was "implacably against any longevity deal".
"He knows insurers and simply didn't think the deals on the table were worth it," said a source.
Shares in Premier Foods fell by more than 12 per cent in one day last month, as the group reported weaker than expected results. A spokesman for Premier Foods declined to comment.Reuse content