Trinity Mirror forfeits £108m to reduce pension deficit
LONDON - Trinity Mirror plans to shell out £108m to reduce its pension scheme deficit and to return £175m to shareholders through a share buy-back programme, using proceeds gained from disposals made earlier this year.
Trinity has been in negotiations with the Pensions Regulator, which approved the company's decision to reduce its pension deficit from £154m to £46m.
The publisher of The Daily Mirror said it remains committed to funding the remaining deficits "over time".
The move clears a major obstacle to any demerger or sale of the company in the future.
The pension top-up and £175m share buy-back programme will be funded by the £263m earned when Trinity sold its sports division. This included its racing newspaper The Racing Post, and its regional South Eastern titles, earlier this year.
The share buy-back will start immediately and continue through the close period.
The company said in a statement that the buy-back programme reflected the board's confidence in the company's ongoing cash flow.
Trinity said: "The group's strong balance sheet after this return of capital will provide continuing financial flexibility for investment to create shareholder value going forward."
Last week, Trinity reported a 2.1% year-on-year increase in group advertising revenues for the five months to November 30 and predicted its 2007 performance to be in line with expectations.
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