Verizon Communications Inc. will transfer pension assets to Prudential to settle about $7.5 billion of its $30 billion in outstanding obligations.
The plan will purchase a group annuity contract from Prudential Financial Inc. (PRU), which will then assume the obligation to make future annuity payments to certain Verizon management retirees, according to a statement today.
With the agreement, Verizon expects to lower risks related to the pension plan while improving its longer term financial profile. The pension transfer won’t change the amount of the monthly pension benefit received by affected retirees and surviving beneficiaries, Verizon said.
The transaction affects U.S. management pension benefits covering about 41,000 current management retirees. It excludes current management employees and those who retired after Jan. 1, 2010.
To contact the reporter on this story: Cecile Daurat in Wilmington at firstname.lastname@example.org
To contact the editor responsible for this story: Cecile Daurat at email@example.com