Verizon Shifts Pension Obligations to Prudential
On Monday, Verizon confirmed that it has shifted its entire pension obligation for retired management employees onto a PrudentialFinancial subsidiary.
Specifically, Prudential Insurance sold the Verizon Management Pension Plan a "single premium group annuity contract" covering Verizon's approximately $7.5 billion of pension liabilities. The move follows Verizon's victory in a Texas courtroom yesterday, when a federal judge ruled against two Verizon employees who had challenged Verizon's attempt to shift its obligations to Prudential.
Prudential confirmed that, under the terms of the contract, it has "irrevocably assumed the obligation, beginning Jan. 1, 2013, to make future annuity payments to approximately 41,000 members of the Verizon Management Pension Plan."
Further financial details were not disclosed. Specifically, Prudential did not say how much Verizon paid it as a premium for the annuity.
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