Avery Dennison Corporation has signed an agreement to transfer $750 million in pension obligations to American General Life Insurance Company, part of AIG’s life and retirement business. The deal covers 8,500 retirees, beneficiaries and deferred and active members.Avery Dennison is conducting the pension risk transfer by purchasing AIG annuities, with AIG assuming the future annuity payments to the 8,500 in Avery Dennison’s plan, commencing April 1. This settlement resulted in $447 million of pretax charges, partially offset by related tax benefits of $180 million.
“We are pleased Avery Dennison selected AIG to manage the retirement security of its retirees, and we are committed to providing them with a smooth transition,” says Ali Vaseghi, chief operating officer, institutional markets. “AIG established its pension risk transfer business over 35 years ago and serves as a trusted partner to plan sponsors as they navigate the complex plan termination process.”
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