£300m pension claim lodged with Johnston Press administrators

The number of mis-sold pension claims in the UK increases each year. A Britain pension agency will file a £305 million pension claim against the administrators of Johnston Press after expressing concerns about a pre-pack arrangement provided by JPI Media, the new owners after the collapse of the regional and iconic publisher. “The Pension Protection Fund” is a key statutory fund that functions to save the collapsed firms’ pension schemes. As per the guidelines of JP debt holders’ takeover deal, the defined benefit pension scheme should not be transferred, and the current move will affect pension compensations to over 250 workers.

However, defined pension contributions will still be provided. The report shows that the entire deficit of defined benefit pension scheme by JP stands at over £40 million. According to a spokesperson from PPF, the agency is committed to protecting the JP pension plan benefits. Since the last disposal of JP pensions, the Work and Pensions Select Committee’s chairman has raised concerns about the same sales. Frank Field, an independent MP sent a letter to Lesley Titcomb, the Pension Regulator chief asking for more discussion details with the publisher.

The MP argued that he could not in any way understand why JPI Media could have reached a decision to purchase JP without assuming full responsibility for the pension schemes. The field had also sent another letter to Oliver Morley, the chief executive at PPF asking him to shed more light on the funding concerns, and the controversial administration deal. The MP also asked Morley whether he was satisfied that appropriated protections are already set in place to safeguard schemes dumped on the PPF at the expense of levy payers and pensioners.

While addressing the mis-sold pension claims, Alix Partner, the spokesperson from JP, observed that JP has been in regular discussion with PPF, The Pension Regulator, and Pension Scheme Trustees since 2014. The spokesperson also pointed out that the firm met all its obligations of the scheme with over £55 million settled to the plan since 2014. Partner argued that JP in close collaboration with various advisors and board and in conjunction with the necessary stakeholders and regulatory bodies including those related to the pensions, before the administration and will continue as expected by law.

The bondholders at JP have also agreed to wipe out over 60% of the £220 million owed to them and intend to change final repayment due date to 2023 and pump nearly £35 million of the new funds into the group. The new decision will secure hundreds of jobs at JP including over 200 job titles including Yorkshire Post, Scotsman, and I Paper. According to a statement issued at The Financial Times, some of the JP’s creditors and bondholders include Benefit Street Partners, Caravel Asset Management, Fidelity, and Goldentree Asset Management.

The latter, a hedge fund and major bondholder based in New York has over $27 billion of assets. According to Goldentree’s LinkedIn profile, the main investments are in form of distressed debt, leveraged loans, and high yield bonds. The Quarterly Holdings Report submitted by the American “Securities and Exchange Commission” affirms that the fund had also reserved equity in the American broadcaster CBS. The American Fidelity has also held equity in various media companies including News Corporation by Rupert Murdoch, SiriusXM’s parent firm, the New York Times, and CBS.

The Boston investment goliath has over $2 trillion worth of assets with significant shares in Alphabet, Google parent company, Facebook, and Amazon. Goldentree refused to provide more details about the controversial investment to the Press-Gazette. The mis-sold pension claims facing JP may result in a vicious court battle. The JP administrators will have to prepare a comprehensive report to refute the ensuing pension claims.