Tennessee Paper Giant Transfers over $1 billion in Pension Liabilities

International Paper Co., purchased a group annuity contract from Prudential Insurance Company on October 1, 2018 to transfer about $1.6 billion in U.S. pension liabilities. Some 23,000 retirees, all of whom receive less than $1,000 in benefits each month, will be affected by the transfer. This is the third transfer of pension liabilities in three years for the company that employs approximately 52,000 people worldwide in more than 24 countries. Back in 2014, International Paper announced that it would freeze future benefit accruals as of December 31, 2018.  International Paper’s U.S. pension plans total more than $11 billion in assets, with projected benefit obligations of $12.895 billion.   As reported in Pensions & Investments, International Paper sees more pension derisking it its future.