Lockheed Martin Reduces Gross Pension Obligation by $4.9 Billion via Purchase of Group Annuity Contracts
Posted on 08/04/2021
Lockheed Martin Corporation (NYSE: LMT) has purchased group annuity contracts from Athene Holding Ltd. (NYSE: ATH), a financial services company specializing in retirement solutions, to transfer approximately US$ 4.9 billion of Lockheed Martin’s pension obligations and related plan assets for approximately 18,000 U.S. retirees and beneficiaries to Athene. The contracts were purchased using assets from Lockheed Martin’s master retirement trust and no additional funding contribution was required as part of this transaction.
On January 1, 2022, Athene will begin paying and administering the retirement benefits of certain retirees and beneficiaries in the Lockheed Martin Corporation Salaried Employee Retirement Program and the Lockheed Martin Aerospace Hourly Pension Plan. The transaction will result in no changes to the benefits received by retirees and beneficiaries. Affected retirees and beneficiaries will receive a letter with additional details about the transfer.
In connection with this transaction, the company expects to recognize a non-cash, non-operating settlement charge of approximately US$ 1.7 billion in the third quarter of 2021, primarily related to the accelerated recognition of actuarial losses for the affected plans.
