Thursday 17 October 2019 7:26 pm

Asda offloads pensions in £4bn deal as it eyes stock market float

Asda owner Walmart is said to have secured a deal to offload £4bn of the UK supermarket’s pension liabilities as it looks to clear the path for a potential stock market listing.

Read more: Asda employees stage fresh protests over contract changes

Walmart and Asda’s pension trustees have agreed a £3.8bn buy-in with specialist insurance firm Rothesay Life, Sky News reported.

Under the mooted deal – one of the largest ever agreed with a British company – Rothesay will be responsible for paying retirement benefits to roughly 12,000 members of the Asda Group Pension Scheme.

The move could prove to be a key step forward as the firm tidies up its balance sheet ahead of a potential initial public offering.

Asda boss Roger Burnley has said he is “minded” to pursue a float as the supermarket chain attempts to split from its US parent company following a failed merger with Sainsbury’s.

A source said Asda was likely to make a one-off payment into the scheme of just under £1bn, while a full buyout was a longer-term objective, according to the report.

The buy-in, which could be announced as soon as this evening, is the latest high-profile deal signed by Rothesay.

The London-based insurance company has secured similar deals with National Grid, Telent and Allied Domecq in the last month.

Read more: Weak Asda sales drive down Walmart’s international income

Rothesay declined to comment. Asda has been contacted for comment.

Main image credit: Getty

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