EMI Pensions Deadlock

It looks like the Pensions Regulator will have to sort out how much Terra Firma needs to put into EMI’s pension fund after talks with its trustees ended in deadlock.

Guy Hands’ investment vehicle may have to shell out up to £170 million to shore it up.

The trustees first contacted the regulator last October after Terra Firma insisted "the scheme does not require an amendment to its contribution rate."

Although both parties have since discussed the matter, pension trustee chairman Ian Smellie – who estimates the fund will soon be in a £170 million hole without further cash injections – doesn’t believe the talks are going anywhere.

He asked the regulator to decide how much additional cash the scheme ought to hold after EMI’s sale to Terra Firma, a deal that left the U.K. music group £2.85 billion in debt.

The trustees have written to the fund’s 22,000 members accusing EMI of failing to offer "meaningful and watertight" securities, according to the Daily Telegraph.

A report in The Times suggests EMI is in the process of trying to offload the pension scheme and has already held talks with Paternoster, Goldman Sachs and the Pension Corporation.

Only 585 existing staffers are members of the final EMI pension scheme, which was shut to new members in 2005.