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Pension Risk Transfer

W.R. Grace transfers $117 million in pension liabilities with group annuity

W.R. Grace & Co., Columbia, Md., purchased a group annuity contract from Prudential Life Insurance Co. of America to transfer $117 million in U.S. pension plan liabilities, the company disclosed in its 10-K filing with the SEC on Thursday.

The company purchased the annuity contract for $116 million and recognized a $1 million gain on the settlement, the filing said. The buyout follows $42 million in lump-sum payments earlier in 2018 to vested employees who left the company before May 1, had yet to receive benefits and accepted an offer made by the specialty chemicals company.

As of Dec. 31, the company's U.S. defined benefit plan assets totaled $871 million, while projected benefit obligations totaled $1.027 billion, for a funding ratio of 84.8%. A year earlier, plan assets totaled $1.11 billion, while the PBO totaled $1.326 billion, for a funding ratio of 83.7%.

Company spokesman Rich Badmington could not be immediately reached to provide further information.