NEWARK, N.J.--(BUSINESS WIRE)--International Paper (NYSE:IP) will settle approximately $1.3 billion of its pension obligations by purchasing a group annuity contract from The Prudential Insurance Company of America (NYSE: PRU), a leader in retirement benefits. The agreement transfers to Prudential the responsibility for paying pension benefits to roughly 45,000 of International Paper’s retirees and their beneficiaries.
International Paper’s decision to transfer a portion of its pension obligations to Prudential is consistent with a strong trend among U.S. companies that are seeking solutions to help them better manage their pension risks and costs.
Peggy McDonald, the senior vice president who led negotiations for Prudential, said, “We are proud that International Paper has chosen Prudential to provide retirement security for about 45,000 of International Paper’s former employees. We are committed to providing them with a seamless transition.”
For International Paper, this agreement enables it to secure and maintain the retirement benefits of its retirees. By choosing Prudential, International Paper is entrusting its pension promises to a company with deep experience in ensuring the long-term management of retirement benefits.
Scott Kaplan, Prudential’s head of Pension Risk Transfer, said, “Prudential is a unique player in the pension risk transfer market, a market that it helped to create. We combine strong pension and actuarial expertise with investment capabilities and deep financial resources. Together, these factors help our clients reduce pension risk while allowing them to focus on their core business. Equally important, Prudential is fundamentally committed to keeping its promises to these retirees and their beneficiaries.”
Since 1923, Prudential has offered pension solutions to companies and organizations. Each year, Prudential makes more than $10 billion in pension payments to more than 1 million retirees and their beneficiaries. Prudential is the global leader in pension risk transfer solutions. This agreement with International Paper follows several other prominent transactions, including those with General Motors, Verizon, Motorola, Bristol-Myers Squibb, The Hartford, Kimberly-Clark and JCPenney.
About Prudential Financial, Inc.
Prudential Financial, Inc. (NYSE:PRU), a financial services leader with more than $1.3 trillion in assets under management as of June 30, 2017, has operations in the United States, Asia, Europe, and Latin America. Prudential’s diverse and talented employees are committed to helping individual and institutional customers grow and protect their wealth through a variety of products and services, including life insurance, annuities, retirement-related services, mutual funds and investment management. In the U.S., Prudential’s iconic Rock symbol has stood for strength, stability, expertise and innovation for more than a century. For more information, please visit news.prudential.com.
Prudential Retirement delivers retirement plan solutions for public, private, and nonprofit organizations. Services include defined contribution, defined benefit and non-qualified deferred compensation recordkeeping, administrative services, investment management, comprehensive employee education and communications, and trustee services, as well as a variety of products and strategies, including institutional investment and income products, pension risk transfer solutions and structured settlement services. With more than 85 years of retirement experience, Prudential Retirement helps meet the needs of 4.2 million participants and annuitants. Prudential Retirement has $401.3 billion in retirement account values as of June 30, 2017. Retirement products and services are provided by Prudential Retirement Insurance and Annuity Company (PRIAC), Hartford, Conn., or its affiliates.