Pensioners settle for pounds 32m out of court: Mirror Group scheme trustees agree terms with institutions Deal lifts hopes of further agreements on assets

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The Independent Online
MIRROR Group pensioners received a pounds 32m boost from an out-of- court settlement with three City institutions yesterday, having scaled down their original claim for pounds 200m in order to avoid a costly six- month trial.

The agreement between the trustees of the Mirror Group Pension Scheme and Invesco Asset Management, Capel-Cure Myers Capital Management and Lehman Brothers also clears the way for a further pounds 16m worth of disputed assets to be handed over to Maxwell pensioners.

Yesterday's deal will strengthen hopes that other out-of-court settlements can be reached between liquidators of the Maxwell business empire and institutions holding hundreds of millions of pounds worth of pension assets.

The settlement was significantly lower than the original pounds 200m claim because the negotiations centred on pounds 50m of pension assets held by the institutions, rather than a claim for damages over their failure to 'blow the whistle' on Robert Maxwell's activities.

Under the deal Invesco will pay pounds 11m. Norman Riddell, Invesco's European chief operating officer, said: 'This settlement clears the decks. We were prepared and ready to defend ourselves in court against these claims. However, we have always been conscious of the damaging effect that a protracted trial and diversion of management effort could have on our business.'

Lehman said that the settlement was a sensible and commercial approach to the case. 'This step does not, in any way, represent an admission of liability by any of the defendants.'

Capel-Cure Myers said the most important consideration in agreeing the settlement was the potential damage to its business that a prolonged trial over the Robert Maxwell scandal could cause. 'Capel- Cure Myers continues to consider itself a victim of the Maxwell fraud and, clearly, the pensioners, as victims of the same fraud, could ultimately suffer further were no settlement to be reached.'

Colin Cornwall, independent chairman of the Mirror trustees, said he was delighted with the settlement: 'When added to the payment of pounds 25m agreed by Bank of America earlier this month, this means that the trustees have now recovered nearly two thirds of the assets which the scheme lost.'

The Mirror scheme covers 6,000 existing and 6,000 future pensioners. Another 20,000 pensioners from the Maxwell companies that went into liquidation face a far more uncertain future.

Yesterday's deal also decided the ownership of pounds 16m of assets, held by the liquidator of the main Maxwell investment company, Bishopsgate Investment Management. Roughly pounds 8m will go to Mirror pensioners, the rest to the other Maxwell pensioners.

Ken Trench, chairman of the Maxwell Pensioners Action Group, said: 'This settlement means that the 20,000 pensioners not directly employed by Maxwell will receive pounds 8m, or about pounds 400 each. That is around 4 per cent of what we need.'

Mr Trench said that the legal actions being pursued by Neil Cooper, the liquidator of BIM, now held the best hopes for non-Mirror pensioners - pounds 80m against Lehman, pounds 33m against Banque Nationale de Paris and pounds 15m against Credit Suisse.

The Mirror pensioners' case was adjourned last week in order to allow the parties to negotiate a settlement. Michael Crystal QC, for the Mirror Group trustees, told Mr Justice Rattee that the deal, however, was 'not the end of the road'.

An action by the trustees, based on alleged breach of trust, has not been settled and is due to start against Credit Suisse in October. Gabriel Moss QC, for Credit Suisse, said the proceedings would be 'contested vigorously'.

(Photograph omitted)

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