Collins & Aikman Corp., Southfield, Mich., will terminate its $253 million defined benefit plan on March 31. The PBGC will assume responsibility for providing benefits to about 21,000 current and retired employees, according to a news release from the agency. The pension plan is 58% funded, with liabilities of $434 million, according to the release. The agency expects to be liable for $161 million of the $181 million shortfall.
Collins & Aikman filed for Chapter 11 bankruptcy protection on May 17, 2005. The companys proposed liquidation plan is the subject of an April 19 confirmation hearing in U.S. Bankruptcy Court.
This is exactly what we expected, and this is another important step in our restructuring process, which involves selling our assets and winding down Collins & Aikman. Our intention is to protect our employees to the extent possible, said Donald Youngman, Collins & Aikman vice president of communication.