FORT SMITH, Ark. Arkansas Best Corp. proposed to withdraw from the Teamsters Central States, Southeast & Southwest Areas Pension Fund and 26 other multiemployer pension funds and pay an estimated $800 million to $850 million in withdrawal liabilities.
The proposal is a key element of the companys current negotiations with the International Brotherhood of Teamsters on a new contract with Arkansas Best unit ABF Freight System Inc., said David Humphrey, director of investor relations at Arkansas Best.
The Central States fund, Rosemont, Ill., has $21.3 billion in assets. The company also proposed withdrawals from $32.6 billion Western Conference of Teamsters Pension Trust Fund, Seattle, and the $3.6 billion New England Teamsters and Trucking Industry Pension Fund, Burlington, Mass., among others.
Our expressed interest is to withdraw from all 27 multiemployer plans if we can, Mr. Humphrey said.
Arkansas Bests withdrawal liability rose to the estimated $800 million level in the past year from $600 million to $650 million because of the withdrawal by a large contributing employer from Central States, the companys SEC filing stated. United Parcel Service Inc., Atlanta, withdrew from Central States last year, paying $6.1 billion.
Because of the sensitivity of the contract negotiations, Mr. Humphrey declined to comment on the type of replacement plan Arkansas Best would propose. Its contract with the Teamsters expires March 31.
Mark F. Angerame, CFO at Central States, couldnt be reached for comment. Galen Munroe, Teamster spokesman, declined to comment on the negotiations.