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Pension Risk Transfer

Weyerhaeuser transfers $1.5 billion in U.S. pension plan liabilities

Weyerhaeuser Co., Seattle, has entered into an agreement to purchase a group annuity contract from Athene Annuity and Life Co. to transfer about $1.5 billion in U.S. pension plan liabilities, the timberland company disclosed in an 8-K filing with the Securities and Exchange Commission on Tuesday.

The transaction, which is expected to close later in the first quarter, will transfer the benefit payments of about 28,500 U.S. retirees and beneficiaries who receive benefits of less than $1,085 a month, spokeswoman Laura Smith said in an email.

The company announced in August its intention to complete a pension buyout in 2019 following the completion of a lump-sum offer to about 20,000 former employees vested in the plan who have yet to retire. Lump sums to participants who took the offer were due to be distributed in the fourth quarter. In the August news release, the company said it expects to reduce its U.S. pension plan liabilities by 30% and the number of participants by 50% following both moves. The pension fund had about 70,000 participants overall, a spokesman said at the time. Ms. Smith said the dollar amount transferred will be disclosed when the company files its latest earnings report this Friday.

As of Dec. 31, Weyerhaeuser's U.S. and Canadian pension plan assets totaled $5.514 billion, while projected benefit obligations totaled $6.795 billion, for a funding ratio of 81.1%, according to the company's most recent 10-K filing. The company did not separate assets by region.

Weyerhaeuser officials could not be reached immediately to provide further information.