UK: pension rights safe in Abbey and gas deals
UK – Commitments to pension security have featured in two large corporate deals in the UK today involving Abbey National and National Grid Transco.
National Grid Transco’s announcement of the 5.8 billion-pound (8.6 billion-euro) sale of four gas distribution networks - the buyers include two Canadian pension bodies - included a commitment to pension rights.
“The purchasers of the distribution networks have confirmed that all existing employee rights including pension terms will be safeguarded,” the firm said.
Among the various institutions and fund groups buying the networks were the Canada Pension Plan Investment Board and the Ontario Teachers Pension Plan.
Meanwhile, Banco Santander Central Hispano has made a similar pledge to Abbey National, which agreed to be taken over by the Spanish bank for about eight billion pounds (euros) in July.
“Santander has written to the Chairman of the Trustees of Abbey's pension funds to provide reassurances that existing pension entitlements of Abbey employees will be safeguarded,” Santander said in a statement.
As part of its offer, Santander has said it would cut around 3,000 Abbey jobs. Santander chairman Emilio Botin met Abbey union representatives on August 23 to tell them about its “exciting plans” for Abbey.
He said: “We are very proud of our record in running successful businesses for the benefit of shareholders, customers and employees and we look forward to working with Abbey staff in the months and years to come.”
As part of the deal Santander plans to award Abbey employees 100 Santander shares following completion of the transaction.