GPG thrown curve ball as regulator looks at Coats pension plans
Guinness Peat Group's wind-down may face a bump in the road after the UK Pensions Regulator indicated it is taking a look at two of the pensions schemes the investment firm is responsible for.
The group, which expects to rebrand under the name of its UK threadmaker unit Coats later this year, has been told by the British regulator the watchdog is investigating into whether "financial support should be provided to those schemes by the company, or by one or more of the entities connected or associated with the schemes' respective sponsoring employers", GPG says in a statement.
"The receipt of this formal correspondence has introduced a new element of uncertainty at this stage as to when these investigations will conclude, whether any financial commitment will result from such investigations, or, should it do so, the quantum involved," GPG says.
"The board is taking advice in respect of this correspondence and continues to work with the parties relevant to the GPG group's UK pension schemes."
GPG had previously expected it would need to set aside £124 million to cover any shortfall in its pension scheme obligations. As at December 31, the pension fund shortfall was valued at £281 million, with low global interest rates eroding theoretical future returns relative to its expected liabilities.
The shares were unchanged at 60 cents.