December 17, 2014 – NCR Corp., the maker of point-of-sale technologies and ATM machines, will transfer about $160 million in pension liabilities after purchasing a single-premium group annuity contract from The Principal Life Insurance Co., according to a filing with the SEC.
The contract affects 4,500 former NCR employees who began drawing benefits from the company plan before Jan. 1, 1994.
The move is in line with the Georgia-based company’s pension transformation strategy, according to a statement from John Boudreau, NCR’s treasurer.
Because existing plan assets were used to purchase the annuity, no additional plan funding was required. The deal is not expected to materially affect the company’s plan funding status, which was 91.5 percent at the end of 2013.
The Principal will start making payments to affected retired workers in April of 2015. Payments will be equal to existing benefits, and the annuity also guarantees survivor benefits.
A note to employees on NCR’s website said health care premiums will no longer be deducted from pension checks.
The same note said the company “has been working for several years to minimize the impact of its pension liability on financial results, while meeting the company’s existing obligations to plan participants.”
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