The Pension Benefit Guaranty Corporation
(PBGC) said it was taking over responsibility for the
pension plans covering 32,500 hourly and salaried
workers of Westpoint Stevens Corp, a bankruptWest
Point, Georgia textile manufacturer. According
the PBGC statement
, the plans were just 46% funded. The agency
said it would assume liability for $286 million of the
company’s $306 million pension shortage.
The PBGC said the plans terminated August 8 and that it had
formally taken them over on Thursday.
Westpoint Stevens filed for Chapter 11 bankruptcy protection on June 1, 2003, and its operating assets were sold to a group led by financier Carl Icahn in a sale that closed on August 8, 2005. Under the terms of the sale, the asset purchaser will not assume the underfunded pension plans.
Within the next several weeks, the PBGC will send trusteeship notification letters to all Westpoint Stevens pension plan participants. Workers and retirees with questions may consult the PBGC Web site, www.pbgc.gov/plans or call toll-free at 1-800-400-7242. For TTY/TDD users, call the federal relay service toll-free at 1-800-877-8339 and ask for 800-400-7242.