Over the past few years the Pension Managers of most large groups of companies, and some not so large, have had to grapple with the pension complications which have arisen when their holding company sells or acquires another company. For example, the pension costs of an acquisition may not have been adequately considered, possibly because the Pension Manager had not been one of the limited number of principals who were involved in the negotiations leading up to the acquisition. Even if the Pension Manager has been involved in an advisory capacity during the negotiations, formidable problems may subsequently arise in integrating the previous pension benefits of the new employees with the benefits of existing employees.

Detailed consideration of the financial condition of the pension scheme of the company which is taken over has been the exception rather than the rule and many companies have found that a seemingly straightforward undertaking to ‘safeguard’ employees' pension rights involves both higher than anticipated pension costs and problems of comparability between similar grades of employees at different locations within the group.