The move affects approximately 8,000 U.S. retirees and their beneficiaries who started receiving their monthly retirement benefit payments on or before June 1. Bristol-Myers Squibb’s U.S. Retirement Plan is in a strong financial position, and the obligations associated with this transaction will require no additional cash contributions by the company. There will be no change to the monthly retirement benefit payments currently received by retirees and their beneficiaries. All other plan participants will stay in the company’s plan.
According to the company, “The transaction reduces risk in the plan and better manages the ongoing variations in cost associated with its maintenance, while entrusting current retirees’ and their beneficiaries’ pensions to a financial institution with expertise in the long-term management of retirement benefits.”
The company’s pension committee engaged Fiduciary Counselors Inc., an independent fiduciary services firm, to represent the plan and all of its participants and their beneficiaries, including those remaining in the plan, to objectively select the safest available annuity as defined by the U.S. Department of Labor (DOL)’s standards. Fiduciary Counselors selected a Prudential contract that provides an additional safeguard by segregating assets in a separate account dedicated to the payment of benefits to plan retirees and their beneficiaries.
All other participants and their beneficiaries in the company’s plan with accrued benefits will remain in the current plan, including retirees who participate in collectively bargained plans or the Puerto Rico plan, as well as certain retirees with variable benefit payments. The transfer to Prudential is expected to occur in December and is subject to the satisfaction of closing conditions.