UK - Pension fund trustees of pharmacy group Boots have agreed a deal with AB Acquisitions which will see the fund receive a significant cash injection when the company is bought.

Today's deal should pave the way for the sale of Boots as the bid vehicle of private equity firm Kohlberg Kravis Roberts (KKR) has agreed will pay £418m (€618.6m) in cash instalments over the next 10 years, amounting to a net present value of £305m.

Furthermore, the £3bn pension fund will benefit from a £600m security package which includes a claim on security proceeds ranking alongside the claims of the senior lenders.

A spokesman for the scheme trustees confirmed to IPE "this deal fully resolves the pension issue" in the takeover of Alliance Boots by KKR.

"We have reached a fair agreement that provides significant security and future certainty to our members," commented John Watson, chairman of the trustees of the 66,000 member scheme.

"All of our members will benefit from the agreement and I am delighted that this period of uncertainty has come to an end with this positive result," he added.

In a statement, AB Acquisition also commented: "We are very pleased to have reached an agreement which will ensure that the Boots Pension Scheme will remain well funded and that the long-term benefits of the scheme members will be safeguarded."

Trustees have been negotiating with AB Acquisitions' major shareholders KKR and Stefano Pessina, Boots' former deputy chairman for several months for financial support of the pension scheme.

It is believed KKR had earlier offered to make a cash injection of just £500m to the pension fund.

European Commission has confirmed it cleared the £11bn takeover deal yesterday.

In separate news, Heinz-Joachim Neubuerger, the former finance chief of Siemens , has also joined KKR as managing director and senior adviser to its London operation.

Neuberger, who was instrumental in founding Siemens' German contractual trust arrangement in 1999, will continue as chairman of DSRC, the German standard setting body , and retain his place on the International Accounting Standards Board's standards advisory council.