ITV shares have moved higher after the broadcaster announced a deal to reduce its pensions deficit by £50m.
It has signed a partnership with pension scheme trustees, backed by the London Television Centre property. The scheme will receive 25 annual payments starting with £2.05m paid on Monday and rising by 5% a year as long as it remains in deficit. The £50m reflects the current value of those payments, and ITV will receive tax relief on this amount in 2014. Finance director Ian Griffiths said:
Over the last few years ITV has made significant progress in managing its pension risk and this is another step forward in that process. Today's agreement reduces ITV's pension deficit on the basis that drives our cash funding whilst retaining operation flexibility with respect to the London Television Centre. It represents a positive deal for members of the defined benefit pension scheme and for ITV shareholders.
To back up his final point, ITV shares have added 4.1p to 193.5p.
