Morrisons bidders must put more property into pensions

Morrisons’ pension funds have said that both bidders must pledge more property to the schemes. Trustees for the two main pension funds said that the debt-financed bids, whether CD&R’s or the one led by Fortress, would “materially worsen” Morrisons’ ability to meet its pension promises. According to the buyout measure the funds have a deficit of £800m. While the funds said they did not envisage either bidder injecting the full £800m in cash, they did expect them to pledge more property assets to the schemes for use if any buyout later failed. “An offer for Morrisons structured along the lines of the current offers would, if successful, materially weaken the existing sponsor covenant supporting the pension schemes, unless appropriate additional support for the schemes is provided,” said chair of trustees Steve Southern. The Morrisons Retirement Saver Plan has 53,600 members, while the Safeway Pension Scheme, which Morrisons took responsibility for when it bought Safeway in 2004, has 31,900. The Times (£) The FT (£) The Guardian The Telegraph (£)