KKR offers Boots pension trustees just £50m

KKR, the US private equity firm backing the bid for Alliance Boots, has offered to increase the retailer's pension fund by just£50 million, compared with the£1 billion demanded by the fund's trustees, according to The Times.

A growing feud between KKR and Alliance Boots' pension fund trustees, who claim they are trying to protect the scheme's future, could derail the takeover.

Last week, Boots pension scheme chairman John Watson wrote to the fund's 66,710 members to warn them of the 'serious implications' that the highly leveraged£11.1 billion takeover bid, which includes more than£8.2 billion of debt, had for the scheme.

The trustees claim that the scheme's existing deficit is about£305 million, largely because of increased life expectancy.

The report comes as it emerged that Alliance Boots chief executive Richard Baker is set to collect a£6.5 million windfall when the buy-out is complete.