Baxter International opens window for lump-sum payments

Baxter International Inc., Deerfield, Ill., has offered a lump-sum window to some participants in its U.S. pension plans, the company disclosed Thursday in its 10-Q filing with the SEC.

The company made an offer in September to "certain former U.S. employees with a vested pension benefit" the limited timeline to accept an offer, which will be paid from pension plan assets in December, according to the filing.

Whether that population consisted of retirees or those who have yet to retire was not disclosed.

It is the latest effort by the medical equipment company to lower its U.S. pension plan liabilities. In 2019, Baxter International entered into an agreement with Prudential Insurance Co. of America to purchase a group annuity contract transferring $2.4 billion in U.S. pension plan liabilities. That contract transferred the responsibility for the benefits of about 17,200 retirees to Prudential.

Current employees are in a separate U.S. pension plan that was split from the Baxter International Inc. and Subsidiaries Pension Plan on Jan. 1, 2018. Baxter will freeze benefit accruals in that plan as of Dec. 31, 2022.

As of Dec. 31, global pension plan assets totaled $2.973 billion, while projected benefit liabilities totaled $3.973 billion, for a funding ratio of 74.8%, according to the company's most recent 10-K filing. That filing did not break down assets by region.

Baxter International officials could not be immediately reached for further information.