4 May 2021: Argyll opens Leeds office

17 Jun 2020: TPR updates Contribution Deferral guidance

5 Aug 2019: TPR's tougher stance on recovery plans

7 Mar 2019: TPR’s Annual Funding Statement a game-changer

7 Dec 2018: DWP publishes superfund consultation

26 Jun 2017: TPR agrees settlement with Coats

30 Apr 2017: PM promises TPR M&A powers

28 Feb 2017: TPR agrees settlement with Sir Philip Green

9 Nov 2016: Brexit so far

8 Nov 2016: BHS ripple effect

2 Nov 2016: Sir Philip Green sent warning notice

1 Nov 2016: Argyll Financial becomes Argyll Covenant

3 Oct 2016: Tata Steel update

2 Jun 2016: BHS to be liquidated

29 Mar 2016: Tata plans sale of UK Steel

3 Sep 2015: TPR takes dim view of late valuations

13 Aug 2015: New TPR covenant guidance

28 May 2015: Contribution notice in Carrington Wire case

22 Dec 2014: Third warning notice for Guinness Peat

18 Dec 2014: New PPF rules for Asset-Backed Contributions

19 Aug 2014: TPR announces Lehman Brothers settlement

10 Jun 2014: TPR publishes revised funding code

27 Mar 2014: EC postpones holistic balance sheet

20 Mar 2014: PPF announces new insolvency risk model

17 Mar 2014: PPF guarantees harder to certify

7 Feb 2014: Argyll Financial submits consultation response

2 Dec 2013: Regulator publishes new draft funding code

19 Nov 2013: Asset-backed contributions guidance from TPR

22 Oct 2013: FSD warning helps MF Global scheme buyout

10 Sep 2013: TPR supportive of Kodak restructuring

31 Jul 2013: Schneider Electric acquires Invensys for £3.4bn

24 Jul 2013: Supreme Court overturns FSD super-priority

8 May 2013: Support for employers in TPR's Statement

10 Sep 2013: TPR supportive of Kodak restructuring

The Regulator has issued a positive response to the completion of the Kodak Pension Plan’s acquisition of Kodak's imaging businesses.

US-based Eastman Kodak Company (‘EKC’) filed for Chapter 11 bankruptcy protection in January 2012. It had failed to adapt its business model quickly enough to the emergence of digital photography.  

EKC had previously provided a guarantee to the UK Pension Plan creating a link between EKC and the Plan.  The trustees of the Plan filed a claim against EKC for £1.8bn in the US courts in November 2012.

A settlement was reached whereby the Pension Plan would acquire two cash generative businesses, Personalised Imaging and Document Imaging, from EKC in return for relinquishing its claim on EKC.  A new scheme, which was voted on by the Plan membership, will be created and is expected to provide greater benefits than would have been provided by the PPF.  The capital EKC will receive for the businesses will help it emerge from Chapter 11.

TPR provided clearance for the transaction in April 2013 and in its latest statement, interim chief executive Stephen Soper said “this is an important step towards reaching an outcome that best balances the needs of members, the Pension Protection Fund, the company and its employees. Where businesses are in a distressed state, we’re prepared to be creative and work collaboratively with pension trustees and employers to explore the options in order to find viable outcomes.”

Argyll comment: debt for equity’ deals are not brand new (eg Uniq in 2011) but what sets this case apart is that existing scheme resources have been used to purchase equity assets of the sponsor.  In such a situation it becomes even more important that trustees have the necessary expert assistance to assess the value to the scheme of an equity interest.  As trustees and employers continue to work together to find creative ways to deal with deficits, TPR has shown that it is prepared to consider proposals that have value for pension schemes particularly if other options are limited.  

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