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Carillion pension trustees, pensions regulator, UK government officials to hold emergency meeting on 12 January

Trustees of Carillion’s [LON:CLLN] pension schemes will on Friday, 12 January, hold an emergency meeting with the UK’s Pensions Regulator (TPR), the Pension Protection Fund (PPF) and civil servants, Sky News reported. The report did not cite a source for the information.
Carillion presented an amended business strategy to its lenders on Wednesday, as previously reported.
The UK-based construction services group’s pension scheme is about GBP 580m (EUR 652m) in deficit, the item said. That deficit would likely increase substantially if the figure was to be determined based on a full buyout of its pension schemes, according to the report.
The meeting on Friday is unlikely to include Carillion itself, the article added.
The report quoted a spokesperson for TPR, which said it has been “closely involved” with talks between Carillion and its pension scheme trustees, but added that it will not make any further comment unless such comment is appropriate.
The PPF would be responsible for pension payments to Carillion employees in the event that the company collapses. The PPF said it knows of the talks between Carillion, its lending banks and the government, according to the report.
Carillion will need short-term financing as of the end of January due to problems including its reported 1HY loss of GBP 1.15bn in September 2017. The group disclosed late in December that it had secured a deferral of a covenant test on its loans from 31 December to 30 April.
One insider cited by the report estimated that Carillion will require new short-term financing of about GBP 300m at the end of January. The company would probably be put into administration if it does not secure that funding, the item said.
The proposals put forward by Carillion to its lenders on 10 January include relinquishing loss-making contracts, securing revised terms for other contracts and possibly securing financial assistance from the state if such support is not forthcoming from the private sector, the report said.
Carillion also plans to sell assets to raise cash, although to date it has only sold a package of healthcare outsourcing contracts to its competitor Serco [LON:SRP] in a GBP 50m deal, the item noted.
The company is also preparing to exchange at least GBP 1bn of its debt for equity, the article continued. Doing so would hand a large stake to its pension scheme, or to the PPF, the report said.
Separately, the Ft.com website reported on Thursday evening that UK government ministers held a meeting on Thursday to discuss the prospect of Carillion collapsing. Carillion has contracts with the government's defence, justice and transport departments, the item noted.

Potential job losses among Carillion's 19500 UK employees were also on the agenda at the meeting on Thursday, the report said.
Carillion's share price closed 2.62p down at 19.98p in London on Thursday, giving the company a market capitalisation of GBP 85.9m.