The PBGC plans to shut down four underfunded Enron Corp. pension plans in an effort to preserve the plans' assets. The agency notified Houston-based Enron that it intends to shut down and take over the company's cash balance plan, the Garden State Paper Pension Plan, Enron Financial Services Pension Plan, and San Juan Gas Co. Pension Plan. The action ensures the entire corporation's assets will be secured to pay for pension benefits before the bankruptcy court begins hearings for the company's reorganization and emergence from bankruptcy.
"The procedural step PBGC is taking today is designed to ensure that enough money remains available to fully protect the pensions of Enron's workers and retirees," said Bradley D. Belt, PBGC executive director. "Acting now preserves assets that Enron can use to pay a private insurance company to take over its pension plans, which would provide full benefits and preserve the option to receive lump-sum payments."