Pensions Bill 2020: Impact on M&A

Changes to be aware of if you are doing M&A involving DB pension schemes.

The Pension Schemes Bill 2020 is progressing through Parliamentary process on the way to becoming law in the UK. This Bill is likely to dramatically change M&A and restructuring where DB pensions are involved, especially when this is combined with the expected revised funding code and guidance being consulted on by TPR currently.

We expect there will be an intense period of adjustment and nervousness as the new rules are interpreted and applied. In the short term, there may be fewer players willing to operate in transactions involving pension schemes. These new measures show the Government and TPR’s clear intent to act more strongly to protect the interests of pension schemes and their members’ benefits. Timely guidance from TPR will be welcome and may help the industry adjust to these new expectations.

The key changes to the pensions regime affecting M&A and restructurings to be introduced by the Pension Schemes Bill that investors, companies and trustees need to be aware of are set out in our briefing note, available to download at the link below. On top of this, a new funding code and guidance from the TPR may also cause a significant change to the value impact of pension schemes in transactions.

Pensions Bill 2020: Impact on M&A
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