Britain’s largest bed-maker and retailer Silentnight has been saved at the last minute from collapse after being rescued by HIG Europe, a private equity firm operating within Europe. I’ve visited a couple of Silentnight stockists over the years and it’s one of those brands you see everywhere, so this one did make me stop and read.
Silentnight is based in Barnoldswick, Lancashire and went into administration following a deficit of £100m in it’s pension fund. That said, it’s a pretty stark reminder that being a big household name doesn’t always mean the finances are in great shape behind the scenes.
The purchase will save 1250 positions within the firm which operates out of the UK and Ireland. Even so, a buy-out like this can still mean changes down the line, so I’d be keeping an eye on what happens with ranges, pricing and warranties over the next year or so.
The sale looks to see the Pension Protection Fund take over the existing pension fund and its existing shortfall. To date PPF is the largest of the creditors mentioned within the claims. The downside is that once the PPF steps in, members can end up with reduced benefits compared to the original scheme.
The final salary pension fund has since been retired with only 100 still working within the group. I’ve spoken to a few people in the trade before and these sorts of changes can be a real blow for long-serving staff.
Members who have yet to retire will see their pensions capped annually at £30,000. For anyone who was expecting more than that, it’s obviously a tough pill to swallow.
