8,000 WATERFORD PENSIONS UNDER THREAT FROM COLLAPSE - The pensions of Waterford Wedgwood's 8,000 workers may be under threat following the collapse of the company yesterday with debts of almost €500 million, writes the Irish Times. The group's pension scheme is more than €111 million in the red and may now have to be wound up if the company cannot be sold as a going concern. The company, however, continues to trade. The current workers, some 800 of whom are based in Waterford Crystal at Kilbarry, would be last in line,after existing pensioners and other beneficiaries, if the scheme is wound up. They would inevitably find their pension entitlements reduced, according to pension experts. The scheme, which is administered by trustees, has a deficit of liabilities over assets of more than €111 million, according to the group's most recent financial results. The situation is likely to have deteriorated as the stock markets in which pensions funds invest slipped further in the final quarter of 2008. Receivers were put in place at Waterford Wedgwood's Irish operations and administrators moved into the British business yesterday after talks with a US private equity investor collapsed at the weekend.
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LEX ON WATERFORD WEDGWOOD - The sound of smashing china and tinkling glass is all part of the fun at new year sales. Now it sounds as though the tableware industry itself is going to pieces, according to the Lex column in today's Financial Times. Crystal and fine china maker Waterford Wedgwood, a pet investment of Irish entrepreneur and non-executive chairman Sir Tony O'Reilly, is the latest household name to be put into administration, joining Royal Worcester & Spode. Banks pulled the plug after the Irish group failed to raise fresh capital. The cracks have been apparent since Waterford, the Irish crystal maker, merged with Wedgwood in 1986. Changing tastes, working capital constraints and failure to tame high production costs in Ireland and the UK while most sales were to the US, have been recurring concerns. Sir Tony first bailed out the Irish icon in the early 1990s. He and brother-in-law Peter Goulandris poured in more than €400m, including €60m last year in spite of an unsuccessful €154m rights issue, to cut net debt of over €449m. Wearied by four rights issues since 2003, ordinary shareholders understandably ran out of patience.
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BoI SUBSIDIARY IN UK PROVIDED £10.7m FOR TROUBLED ADAMS - Bank of Ireland's UK-based Burdale subsidiary provided a €10.7m refinancing and working capital facility in recent months for the Adams Childrenswear clothing chain that has gone into administration and closed 111 of its outlets, says the Irish Independent. It is the second time in weeks that Burdale has been exposed to troubled retailers. The subsidiary headed a consortium that loaned €414m late last year to Woolworths, which collapsed before Christmas. Burdale is almost certain to recoup its loan to Woolworths, with the facility having been backed by the chain's extensive trading stock. It has also emerged that Burdale is likely to receive millions of pounds in penalty fees from Woolworths, which was placed into administration under Deloitte. A spokeswoman for Bank of Ireland declined to comment yesterday on Burdale's involvement in either Woolworths or Adams, or on how much the arm might receive in penalty payments from Woolworths.
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FRY FACES TOUGH TASK AT TROUBLED JOHNSTON PRESS - John Fry, who took over at the helm of troubled Johnston Press yesterday, has his work cut out for him as the company, one of the worst-performers on the London stock market last year, faces up to the challenge of a possibly prolonged recession, writes the London Independent. Mr Fry, who succeeds Tim Bowdler as chief executive of the regional media company, may need to focus first on conserving cash before he can even think of implementing a long-term growth strategy for the group. Mr Fry, who joins from the Norwich-based regional newspaper company Archant, has worked at the information management company Dun & Bradstreet and at the business consultancy Bain & Company. Prior to that, he graduated from the prestigious French business school Insead as top student in his year. He will need all his business acumen and intellect to turn around the fortunes of Johnston Press. Media companies are suffering - in particular in the regional press - as businesses cut back on advertising to conserve cash.
