A PBGC news release said it is stepping in because the underfunded retirement plan will be unable to make benefit payments and faces abandonment following the sale of substantially all the assets of the closely-held hospitality and real estate corporation based in St. Simons Island, Georgia.
The sale does not include the pension plan; by taking action now, the PBGC prevents further deterioration of the plan’s condition.
The Sea Island Company Retirement Plan is 48% funded, with assets of $37.3 million to cover benefit liabilities of $77.2 million, according to PBGC estimates. The agency expects to be responsible for $36.2 million of the plan’s $39.9 million shortfall.
The PBGC will take over the assets and use insurance funds to pay guaranteed benefits earned under the plan, which terminates as of October 29, 2010.