One of the most important takeover bids of recent times was agreed this week. Telent, a small telecoms equipment company, agreed to be bought for £398 million by something called Co-Investment Number 5 LP Inc, a Guernsey-based partnership. Nothing greatly of interest in that, it might seem, except Telent is the rump of the old Marconi, which was itself the old GEC, one of the biggest industrial companies of the 1970s. It is still the sponsor of one of the country’s biggest pension funds, a £2.5 billion heavyweight responsible for the retirement incomes of 62,000 past and present employees.

CI5LP is a vehicle set up by Pension Corporation, which makes no secret of the fact that it likes to buy companies to get its hands on their pension funds. It has already applied the formula to the Threshers off-licence chain and the old Thorn TV rentals group, and is also stakebuilding in Aga, the stoves maker.

In his bid announcement, Edmund Truell, PC’s founder, said that he planned to apply PC’s investment and administrative skills to support and enhance the management of the pension scheme. He also said he plans to be a “committed and long-term owner” of the scheme.

This unfortunately sounded more arrogant than reassuring. The pension scheme is a legally independent body with its own trustees. It will not be “owned” by PC even if PC succeeds in buying Telent. Nor is it Telent’s or PC’s decision how the scheme is managed but that of the nine trustees, of whom only three are Telent executives.

The trustees’ only concern is to make sure every scheme member has their promised pension paid out in full. Since the youngest member is only 21, it means having a 60 or 70-year horizon. The fund is not in bad shape, with no deficit (by some measures) and with a ring-fenced £514 million cushion held in escrow.

It may be that PC’s sophisticated financial engineering talents will be just the thing for fine-tuning the fund. It may be that its covenant is stronger than that of the tiny Telent.

But PC has got off to a terrible start, keeping the trustees in the dark and still having had no substantive discussions with them. Mr Truell’s explanation that he could not talk to them ahead of the bid announcement is specious. It would have been perfectly possible to make them insiders, as Delta Two has done with the J Sainsbury fund trustees.

Winning responsibility for the fund was not some minor side-effect of the deal for PC, but its entire purpose. Not to have talked to the trustees seems like poor judgment, if not plain insulting, and has aroused suspicion from the start.

Mr Truell, the founder of the private equity group Duke Street Capital, and his team of rocket scientists at PC are some of the brightest financial brains around. But they do not seem to have seen how this might play to ordinary members a week after Northern Rock sent trust in the financial services industry to a new low. The trustees will need all the reassurance they can get anyway – unlike an insurance company buyout of a pension fund, members of schemes sponsored by organisations like PC are much less protected in the unlikely event of sponsor failure.

With the best will in the world, PC’s interests are not entirely aligned with those of the scheme trustees and the members, nor are their time horizons the same. Cazenove estimates that any bidder might have to wait till 2045 before starting to tap any of that juicy escrow.

The deal deserves the most intense scrutiny from the Pensions Regulator. And Mr Truell must start talking to the trustees.

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