Sonoco Products Co., Hartsville, S.C., plans to terminate one of its U.S. defined benefit plans in 2020, spokesman Brian Risinger said in an email.
The company's board of directors approved the termination of the Sonoco Pension Plan for Inactive Participants at its meeting Wednesday, pending approval from the Pension Benefit Guaranty Corp. and IRS.
Sonoco contributed a total of $190 million to its two U.S. pension plans in May. The contribution brought the funding ratio of each plan to about 97%, Mr. Risinger said. The company said it will continue to maintain its other U.S. plan, the Sonoco Pension Plan.
Following approval, the company in 2020 plans to make a lump-sum offer to participants who have yet to retire and an additional contribution to the plan, followed by the purchase of a group annuity contract from an insurance company to transfer the responsibility of its remaining liabilities. The additional contribution is expected to be between $75 million and $125 million, the filing said.
As of Dec. 31, 2017, the Sonoco Pension Plan for Inactive Participants and the Sonoco Pension Plan had $566 million and $570 million, respectively, in assets, according to the company's most recent Form 5500 filings.