UK food company Uniq has terminated bid talks with a private equity player over fears that a highly leveraged takeover would jeopardize the company’s pension fund. The company said the main reason for terminating talks was “the leveraged nature of the potential bidder’s proposed capital structure and its impact on the pension position.”
The trustees reportedly feared that being taken over by a heavily borrowed bid vehicle would mean that, in the case of insolvency, the pension fund members would lose their pensions.
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