Corporate Activity

In the current economic and regulatory climate, pensions can play a significant role in corporate activity.

Corporate Activity

Overview

A small misstep can have severe financial repercussions that may not come to light for many years. Solutions therefore need to be commercial, practical and far-sighted.

In the transactional space, we have a track record of advising corporates, sponsoring employers, pension scheme trustees, private equity and other investors and lenders on transactions and mergers and acquisition at the leading edge of the market, on listed and private acquisitions and, on deals with worldwide reach using our global network of close ties with carefully chosen overseas independent law firms who share our specialist strengths and very demanding quality standards.

Our Corporate M&A and ECM, Private Equity and Financial Sponsors, Finance and Pensions practices work seamlessly as one team to deliver practical pensions solutions for our clients in all these areas.  Our industry links and appointments, coupled with our client base, ensures we are at the forefront of developments in the market as well as changes to legislation. Our experience acting for all types of market participant means we understand there are different perspectives and anticipate where potential issues may arise.  We take a pragmatic and commercially-focused approach that leads clients to instruct us regularly on their highest-profile and most important work.

Corporate pension issues do not solely arise on transactions.  Our clients operate pension funds with assets, collectively, of over £90 billion. Against this backdrop, we provide strategic ongoing advice to employers on how to optimise their legal group structures to manage pension scheme cost and exposure. This includes managing employer withdrawals from pension schemes and associated statutory "section 75" debt management and apportionment arrangements, implementing contingent support such as pension escrow accounts, guarantees and asset-backed contributions, and managing Pensions Regulator involvement in corporate activity.

In addition, corporates planning capital restructurings, dividends, share buybacks, group structure reorganisations, refinancings and similar are well advised to consider how the project will affect the sponsoring employer's ability to sustain its pension obligations (the employer covenant). The Pensions Regulator expects trustees of defined benefit pension schemes to undertake increasingly sophisticated monitoring of the employer covenant and to take action where the covenant is jeopardised. All of this is conducted against a backdrop of regular actuarial valuations and scheme funding negotiations. We are well versed in this area and have good relationships with all the major employer covenant advisory firms from which our clients benefit.