Freshfields Bruckhaus Deringer and Slaughter and May are both advising on the restructuring of Royal Mail as the Government prepares to take on the postal operator's multibillion-pound pension deficit.

Freshfields is advising the Government on the transaction, which will see £37.5bn of Royal Mail's legacy pensions liabilities transferring to the state, including a deficit of around £9.5bn, as well as the restructuring of the company's balance sheet to allow for privatisation.

Pensions partner Charles Magoffin and City antitrust, competition and trade head Rod Carlton are leading Freshfields' team, which also includes corporate partners Tim Jones and Martin Nelson-Jones, financial institutions partner Mark Kalderon and finance partner Nick Bliss.

Meanwhile, Slaughters is advising Royal Mail with corporate partner Jeff Triggs leading a team alongside pensions and employment partner Sandeep Maudgil and competition partner Isabel Taylor.

The restructuring was approved by the European Commission yesterday (21 March), when it gave the go-ahead to UK plans to relieve the Royal Mail of the excessive pension costs relating to its past monopoly position and to provide restructuring aid that will cut Royal Mail Group's debt by £1.08bn.

Carlton said: "The European Commission has been very active in regulating the European postal sector, so our pensions and EU state aid teams have worked closely with UK Government officials and lawyers over the past year to steer the Royal Mail case through twin-track processes involving Parliament and Brussels. The EC clearance announcement is a great outcome."

The deal will involve the transfer of £28bn of assets from the Royal Mail pension scheme into a new statutory pension scheme providing pension benefits and an investment fund.

The news comes after Triggs was appointed as Royal Mail's interim general counsel in April last year following the departure of former legal chief Doug Evans. Triggs' tenure as GC came to an end in December 2011 following the hire of Neil Harnby from GE.