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Aluminum August 09, 2022 03:55:19 PM

Alcoa Corporation to Purchase Group Annuity Contracts

Paul Ploumis
ScrapMonster Author
Two subsidiaries of Athene Holding Ltd. have been entrusted with execution of the group annuity contracts.

Alcoa Corporation to Purchase Group Annuity Contracts

SEATTLE (Scrap Monster): Pittsburgh-based Alcoa Corporation announced purchase of group annuity contracts for certain U.S. pension plans. The move will facilitate the transfer of around $1 billion of pension obligations and assets associated with pension plans of U.S. retirees and beneficiaries. The transfer is expected to be completed before the end of this month.

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This is Alcoa’s fifth pension annuity transaction for a total transfer of approximately $3.3 billion in pension obligations and assets from 2018 to date. It will further enhance the company’s strong balance, reduce volatility risks in pension plan obligations and help meet commitments to retirees and beneficiaries, said the company press release.

Two subsidiaries of Athene Holding Ltd. have been entrusted with execution of the group annuity contracts. The leading retirement services company will assume payments of approximately 4,400 participants in the U.S. pension plans. It will take over payment obligations in November this year.

Alcoa will record a non-cash settlement charge of approximately $635 million related to the annuity transaction during the third quarter of the year. After completion of the transfer, the company expects its U.S. defined benefit pension plans to remain more than fully funded.

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