Guinness Peat Group is being prevented from paying shareholders a dividend until it reaches an agreement with The Pensions Regulator over deficits at three defined benefit pension schemes.
The group has locked horns with the regulator over how it funds the schemes it sponsors, which have a combined deficit of £237m, the BBC reports.
GPG has cash reserves of £369m which it wants to hand to shareholders but has been in dispute with TPR for nearly two years.
TPR has now issued a warning notice saying GPG needs to put more cash into the Coats textile company scheme, which carries the bulk of the pension liabilities with a £148m deficit and 27,000 members.
GPG chairman Mike Clasper says his board will continue to fight the regulator over the suitability of the trustees’ recovery plan for the schemes.
He says: “As previously indicated the board, having taken external advice, submitted calculations to the pensions regulator which showed that all the sponsoring companies for the Coats plan were sufficiently resourced as at the relevant date.
“It is therefore extremely disappointing to receive the warning notice in relation to a scheme for which a recovery plan was agreed with the trustees in 2013.”
TPR has already issued warning notices over the Brunel and Staveley schemes, also sponsored by the company. The regulator’s determination panel will consider these cases in 2015. If GPG is unsuccessful in overturning the latest warning notice, the panel will make a determination on how the Coats scheme should be funded.