BAE Systems, London, is injecting £181 million ($332 million) in cash and £480 million in other assets this year to help close a £3.1 billion deficit in its four main U.K. pension plans, according to a news release. Another £426 million in cash will be contributed over the next 10 years to close the company's deficit by 2017 under IAS 19 accounting standards.
Spokeswoman Lisa Hillary-Tee said most of the £181 million has already been transferred and "will be invested in line with current asset allocation strategy..."
BAE Systems had £10.8 billion in pension assets as of Dec. 31 in BAE's four schemes: Main, 2000 Plan, Royal Ordnance and Shipbuilders. The plans are based in Farnborough, England.
Also, the company gradually increased its share of pension contributions for existing employees in the Main Pension Plan to 18.21% of their annual salaries, from 11.7%; the £642 million gained will go toward the deficit. Employee contributions were increased to 9.29% of their annual salaries, from 5%.