LONDON (Alliance News) - Industrial chains and power transmission products manufacturer Renold PLC on Monday said it has struck a deal in the UK and received a court ruling in Germany which will further de-risk its existing pension scheme liabilities.
Renold said its Renold Pension Scheme, its UK legacy defined-benefit scheme, has completed a second medically underwritten insured buy-in which will fully de-risk another GBP27.0 million, or around 25%, of its current UK pensioner liabilities.
The new agreement will mean Renold is now fully-protected against any risks arising from volatility in longevity, inflation and interest rates in respect of members of the scheme.
In addition, Renold said a German court has confirmed the pension scheme of the company's subsidiary in the country was property closed to future accrual with effect from the end of September 2013. This will result in a reduction in unfunded pension obligations for Renold in respect of the German scheme of around GBP1.5 million.
"These actions significantly reduce and further de-risk our pension liabilities in the UK and Germany. At the same time, they lower future funding costs and thus protect the group's ability to invest further in the business," said Chief Executive Robert Purcell.
Shares in Renold were untraded on Monday, having last traded at 56.00 pence.
By Sam Unsted; samunsted@alliancenews.com; @SamUAtAlliance
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Renold (RNO)