Clothes retailers Marks & Spencer Group saw its shares rise almost two and half per cent on Wednesday after announcing that it has reduced its pension deficit and significantly lower annual cash contributions.
The news prompted a revival of recent takeover talks.
The value of the pension scheme has resulted in a deficit of £290m, markedly lower than the £1.3bn as at March 31st 2009.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Together with its trustees, the company has agreed a 10-year funding plan which includes annual cash contributions of £28m per annum from 2013/14 to 2016/17, a reduction on the previously agreed £60m per annum until 2017/18.
The group said the remaining balance is expected to be met by investment returns on the scheme's existing assets.
In a statement the company said: "The improvement reflects the additional contributions made to the Pension Scheme following the 2009 valuation together with strong investment growth and sound risk management."
Shares rose 2.38% to 387.70p by 13:45.
NR
-
Trump wants to colonise Mars – will it happen?Donald Trump wants to plant the US flag on Mars. Could humans really live there?
-
Klarna postpones US IPO as Trump's tariffs rattle marketsBuy-now-pay-later lender Klarna has postponed its US initial public offering owing to the market turbulence. It is not alone, says Matthew Partridge
