Tata Steel has officially ditched its £15bn, 130,000-member UK pension scheme.
The Indian-owned firm received confirmation today from The Pensions Regulator that it had approved a separation of the British Steel Pension Scheme (BSPS) under the rarely used regulated apportionment arrangement.
As part of the deal, the BSPS received £550m from Tata Steel and a 33 per cent equity stake in Tata's UK steel operations.
Tata Steel will also sponsor a proposed new pension scheme. All members of the BSPS will be given the option of joining the new Tata scheme paying lower benefits or entering the Pension Protection Fund.
Germany's Thyssenkrupp could reach an agreement in principle this month to merge its European steel business with Tata Steel, Reuters reported.
The deal has been held up because of Tata Steel's huge pension liabilities, but today's decision paves the way for talks to resume.