GardaWorld's G4S acquisition offer includes £770m pension support package

GardaWorld has agreed to a £770m support package with the G4S UK Pension trustee as part of its final cash offer to acquire the British security services company.

The increased and final cash offer stands at 235 pence per G4S share, which values the London-listed company at £3.68bn, and is a significant increase from the previous offer of 190 pence per share.

GardaWorld said it believed that the package offered a step change in the magnitude of funding relative to the existing scheme and provided “a definitive resolution to the persistent deficits that have been a feature of G4S's UK defined benefit pension arrangements”.

G4S’s half year results, released in July, listed its net pension deficit at 30 June 2020 as £276m, down from £463m 12 months prior due to an increase in the value of scheme assets and two scheduled deficit repair contributions of £26m.

From 2011 to 2020, G4S’s scheduled deficit repair contributions have increased from £38m to £52m per year.

GardaWorld, which is a wholly-owned subsidiary of Fleming Capital Securities, added that the package would “significantly enhance” the certainty of pension benefits for G4S's current and past employees through the collective commitment to industry best-practice funding levels in a well-defined timeframe.

GardaWorld founder, chairman, president and CEO, Stephan Crétier, said: "There can be no better owner for G4S than GardaWorld. Ours is a programme for growth and investment that G4S so desperately needs. This will take time, but we have the skills, expertise and ambition to take on this challenge.

"We urge shareholders to accept our final offer, doing so in the knowledge that G4S's customers, employees, pension scheme members and the wider public will finally get the excellent service, invigorating working culture and safe pension benefits they deserve."

A statement from G4S said the company’s board was currently evaluating the revised offer, together with its financial and legal advisers.

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