Delta Air Lines Pilots Retirement Plan has been taken over by the PBGC, confirmed Gary Pastorius, spokesman for the agency. The PBGC became trustee of the plan and assumes responsibility for the pension benefits of the Atlanta-based airline's 13,000 active and retired pilots. The plan has $1.7 billion in assets and is underfunded by about $3 billion; the PBGC estimates that it will be responsible for almost $920 million. On Dec. 20, the U.S. Bankruptcy Court in New York approved an agreement between Delta and the PBGC allowing the termination of the pilots' retirement plan. Delta filed for Chapter 11 bankruptcy protection in September 2005.
"Delta appreciates the PBGC's recognition that the company satisfactorily met all of the statutory criteria for a distress termination of the Delta Pilots Retirement Plan and that the agency is now the plan's trustee," Edward H. Bastian, Delta CFO, said in a statement.
The airline intends to emerge from bankruptcy protection in the spring, according to a reorganization plan filed Dec. 19 with the court.