Lennox International Inc., Richardson, Texas, announced Monday that it is offering a lump-sum window to some participants in its U.S. pension plans, according to a 10-Q filing with the Securities and Exchange Commission.
The offer is being made “as part of our overall strategy to derisk our pension plans,” the filing said, to “certain vested participants” in the U.S. pension plans. The company expects its projected benefit obligations to be reduced by about $50 million as a result of the lump-sum payments. All of the company's U.S. pension plans are frozen.
Further information on the population to which the company is making the offer was not made available; however, the population likely consists of former employees who have yet to retire, as there are IRS prohibitions against giving such an offer to current employees or current retirees.
As of Dec. 31, the company's worldwide pension plan assets totaled $293 million, while projected benefit obligations totaled $415.4 million, for a funding ratio of 70.5%, according to its most recent 10-K filing. The company does not break down assets and liabilities by region but said U.S. plans account for 88%, or $257.8 million, of total worldwide assets.
Phil Gee, company spokesman, could not be immediately reached to provide further information.