Hickory Springs Manufacturing Co., Hickory, N.C., signed a $75 million “pension buy-in” contract with Prudential Retirement, the first such transaction in the U.S., said Phil Waldeck, senior vice president and head of Prudential Retirement’s pension and structured solutions business.
Steve Ellis, Hickory Springs CFO, said the agreement for about 1,000 retirees covers “approximately half of our total defined benefit obligations” of just over $150 million.
Hickory Springs will continue to maintain the relationship with the retirees and send them their checks; under the contract, Prudential will provide the monthly payments to the plan, which it will use to meet those retirement obligations, Mr. Ellis said.
There have been a number of such pension risk transfers in the U.K. market, Mr. Waldeck said in an interview.
