Innovative approach to chronic defined benefit pension deficit sees AIM-listed Uniq sold by its 90.2% shareholder, Angel Street, to Greencore in agreed takeover
Greencore Group plc today announced an agreed cash offer (the Offer) to acquire Uniq plc. The holder of 90.2% of Uniq’s shares, Angel Street, has irrevocably undertaken to accept the Offer, meaning that the acquisition is almost certain to be successfully completed. The terms of the Offer can be read here.
The Offer marks the end of a long process of restructuring Uniq, which had a defined benefit pension scheme that was heavily in deficit and which it was unable to fund – at around £430 million, the deficit was vastly bigger than Uniq’s own market capitalisation.
The first stage of addressing that deficit was completed by scheme of arrangement (the Scheme) in March 2011, when 90.2% of Uniq’s shares were acquired by a special purpose vehicle, Angel Street, that became responsible for the defined benefit scheme. The commercial effect of this restructuring was that Uniq became owned by its pension scheme, bar 9.8% which remained with Uniq’s shareholders, and Uniq was freed from further obligations to the pension scheme. In March 2011 and at the same time, Uniq left the Main Market of the London Stock Exchange and was admitted to trading on AIM. This part of the Uniq website contains the public documents that effected the Scheme and the restructuring.
We reported on the Scheme in a series of three posts – which can be read here (discussing the Scheme in general), here (discussing the amendment of a special resolution) and here (discussing the court’s discretion in relation to the Scheme) – in March 2011:
On 18 March 2011 the High Court sanctioned a scheme of arrangement (the Scheme) between Uniq plc and its members. The Scheme judgment is here. The result of the Scheme, and the restructuring of which it was a part…is that 90% of Uniq’s equity will be transferred to a specially-incorporated vehicle [i.e. Angel Street] and, hopefully, sold for the benefit of the defined benefit part of Uniq’s pension scheme. The shareholders in Uniq will be left with one-tenth of their previous holding in Uniq’s equity, and Uniq and its subsidiaries will be released from their obligations to the defined benefit part of the pension scheme.
The Offer by Greencore, which is London-listed, is the second and final stage of addressing the pension scheme deficit. The consideration payable by Greencore for the 90.2% of the shares in Uniq held by Angel Street will in effect be received by the pension scheme for the benefit of the scheme’s members.
The holders of the remaining 9.8% of the Uniq shares will, if they do not accept the offer, be “squeezed out” under the provisions of Chapter 3 of Part 28 of the Companies Act 2006.
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