The New York Times Company Reduces Pension Obligations by $225 Million

The New York Times Company announced today that it has entered into agreements with Massachusetts Mutual Life Insurance Company (MassMutual) to transfer pension benefits and annuity administration for approximately $225 million in pension obligations.

The agreements relate to two of the Company’s pension plans, The New York Times Company’s Pension Plan and The Retirement Annuity Plan for Craft Employees of The New York Times Company. Under the agreements, these pension plans will purchase group annuity contracts from MassMutual for approximately 3,800 retirees (or their beneficiaries). The group annuity contracts include an irrevocable commitment by MassMutual to make annuity payments to the affected retirees. All other retirees will continue to receive monthly benefit payments from the plans.

The agreements will transfer the payment administration and obligations to this highly rated insurance company with a long history of efficiently providing annuity benefits. This arrangement is part of the Company’s continued effort to manage the overall size and volatility of its pension plan obligations, and the administrative costs related thereto.

The transfer will not change the amount of the monthly pension benefits received by the affected retirees (or their beneficiaries), and no action is required on their part. Affected retirees will soon receive information packages with further details.

The Company expects to finalize the transactions by early 2018. The purchase of the group annuity contracts is being funded through existing assets of the pension plans’ respective trusts, including proceeds from a $100 million discretionary contribution by the Company.  As a result of the agreements, the Company expects to recognize a pension settlement charge of approximately $95 million before tax in the fourth quarter of 2017. This charge represents the acceleration of deferred charges currently accrued in accumulated other comprehensive income.
http://investors.nytco.com/press/press-releases/press-release-details/2017/The-New-York-Times-Company-Reduces-Pension-Obligations-by-225-Million/default.aspx

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