ADM to offer lump-sum payments to former employees
By Kevin Olsen | September 21, 2012 3:15 pm
Archer Daniels Midland Co., Decatur, Ill., will offer lump-sum payments to vested employees who no longer work for the company, confirmed spokeswoman Jackie Anderson.
The offer will be made to between 7,000 and 7,500 participants of the defined benefit plan, Ms. Anderson wrote in an e-mail. Participants will have from Oct. 1 to Nov. 15 to accept the offer.
The company estimates that 50% to 75% of eligible participants will accept the offer, resulting in a global pension obligation reduction of $140 million to $210 million. That move is also expected to improve the plan's underfunding by $35 million to $55 million.
ADM expects an ongoing annual reduction of $4 million to $5 million in pension expenses on a pretax basis.
The defined benefit plan had $2.24 billion in assets and $3.1 billion in pension obligations for a funded status of 72.3% as of June 30, according to the company's most recent 10-K filing.