Essential pension issues for buyers of a company or business

Pension issues in share and asset sales can be complex, particularly when a final salary (defined benefit) scheme is involved. Buyers of companies have always had to investigate a target company’s pension provision as part of their due diligence, particularly in recent times when poor investment returns have adversely affected funding. But the new powers and compliance obligations of the Pensions Regulator have added to the complexities.

This note outlines the different scenarios and actions for the purchaser depending on whether there is an asset or a share sale and the type of pension provision.

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