06 February 2008

Commenting on the news that the Pensions Regulator has issued Financial Support Directions on Sea Containers, Richard Jones, Principal at Punter Southall says:

"It is good to see that the Pension Regulator is not toothless and is making an attempt to make employer's stand behind their pension obligations. However the issue with the Sea Containers case has always been what impact the Financial Support Direction ("FSD") would have given that Sea Containers is involved in the very complex Chapter 11 bankruptcy process. We will therefore have to wait and see whether the FSD has any significant impact on the security of the members' benefits. It is also somewhat disappointing that the FSD was imposed by default rather than through a process of challenge as Sea Containers has withdrawn its appeal rather than the Pensions Regulator winning the arguments of the case. An open argument would have given Trustees and employers useful information on the factors that will be taken into account in an appeal and the way the appeals process itself will work. One is slightly concerned that the now withdrawn appeal was a delaying tactic surrounding the complexities of the Chapter 11 process and the reason the appeal has been withdrawn is because the process has advanced far enough that Sea Containers now perceives the imposition of the FSD to be a minor irritant to its goal of achieving value from the bankruptcy process for its shareholders."

For more information or to speak to Punter Southall, please contact:

Penrose Financial

Andrew Flemming

020 7786 4811

andrewf@penrose.co.uk