24 Oct 2022: Argyll's Leeds team hires new Analyst

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

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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

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

The Invensys Board agrees to recommend Schneider’s offer.  As part of the deal, Schneider will take on the £5bn Invensys Pension Scheme.

Argyll comment:  the large pension obligation may potentially have been a factor in the failed approach by US-based Emerson Electric in 2012.  However, the financial position of the Invensys Pension Scheme (‘IPS’) had been shored up earlier in 2013 following Invensys’ sale to Siemens of its Rail division in May.  Of the £1.7bn proceeds, £625m was earmarked for the IPS in the form of £400m cash with the rest held in a contingent asset.  Invensys had long been seen as a takeover target and by addressing the pension deficit, it was always likely to attract further interest.

Prior to the transaction, Schneider Electric had fairly strong cash generation and relatively low debt.  Net debt will increase by around €3bn but looks like it will remain at manageable levels and overall the acquisition appears to be a good fit for Schneider.  As for the covenant faced by the IPS, this will depend largely on the restructuring plans Schneider has for Invensys and how that will affect the scheme’s sponsors.  Nevertheless, Schneider Electric was the stronger, much larger group so there could be potential upside for the covenant, particularly with the right scheme support structure in place.


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