Archer Daniels Midland turns to Prudential for pension buyout

Archer Daniels Midland Co., Chicago, purchased a group annuity contract from Prudential Insurance Co. of America to transfer about $500 million in U.S. pension plan liabilities, spokeswoman Paula Heinkel said in an email.

The transaction, which closed Nov. 2, transfers the benefit payments and administration of about 3,800 retirees and beneficiaries in the ADM Retirement Plan who began receiving benefits on Jan. 1. Prudential will take over benefit payments effective Jan. 1, 2019, Ms. Heinkel said.

The purchase was funded directly by the plan's assets, the company's 10-Q filing with the SEC said. According to the company's most recent Form 5500 filing, the ADM Retirement Plan had $1.5 billion in assets and 3,896 retirees or beneficiaries receiving benefits.

ADM in its most recent 10-K filing reported $2.448 billion in total pension plan assets and $3.109 billion in projected benefit obligations, for a funding ratio of 78.7%.