Pensions to be safeguarded in Carpetright acquisition

Meditor Holdings Limited (MHL) has confirmed that no changes will be made to the Carpetright pension schemes if its acquisition of the company is confirmed.

In an announcement today (15 November), it was revealed that MHL and Carpetright have agreed the terms of a recommended cash offer to give MHL full control of the business.

MHL currently owns 29.9 per cent of the company and has agreed a sum of £15.2m to take control of the firm.

The announcement noted that Carpetright operates “a number of pension schemes” and that MHL “does not intend to propose any changes to the terms of such schemes or the level of employer contributions.”

The purchase is conditional on no member of the Carpetright Group making or agreeing to any “significant changes” to the pension trust deeds, benefits, qualification for accrual or the way benefits and liabilities are calculated since 27 April 2019.

Carpetright approved a Company Voluntary Agreement (CVA) in April 2018, which saw the closure of 81 stores as the company was threatened by insolvency.

Following the CVA, the Pension Protection Fund reached a deal with the company that, if the CVA failed, the schemes would be protected.

Unlike other British high street brands such as BHS and Toys R Us, which had substantial pension deficits when they proposed CVAs, Carpetright’s defined benefit scheme had a deficit of £200,000 at the time.

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