Alcoa Further De-Risks Certain U.S. Pension Plans Through Additional Annuity Contracts
December 14 2021 - 3:10PM
Business Wire
Alcoa Corporation (NYSE: AA) today announced the purchase of
additional group annuity contracts that will further enhance the
Company’s strong balance sheet, reduce the risk of volatility in
pension plans and secure the Company’s commitments to retirees and
beneficiaries.
The additional annuity contracts with two subsidiaries of Athene
Holding, Ltd. (NYSE: ATH) will facilitate the transfer of
approximately $500 million of pension obligations and related
assets associated with defined benefit pension plans for certain
United States retirees and beneficiaries.
The transfer complements a prior annuitization announced last
month for certain U.S. pension plans. That action, which is now
complete, included approximately $1 billion of pension obligations
and related assets.
As a result of the action announced today, Athene will assume
later this month obligations for approximately 2,600 participants.
There will be no benefit changes for those covered by the pension
plans.
Athene, through its subsidiaries, is a leading retirement
services company with total assets of $224.4 billion as of
September 30, 2021. With operations in the United States, Bermuda
and Canada, Athene specializes in helping its customers achieve
financial security and is a solutions provider to institutions.
Athene’s principal insurance company subsidiaries have an “A”
rating from A.M. Best and Fitch Ratings and an “A+” from Standard
and Poor’s Global Ratings.
Alcoa expects to record in the fourth quarter of 2021 a non-cash
settlement charge of approximately $285 million (pre- and
after-tax) related to the December action. When combined with the
prior annuity purchase announced in November, the total charge in
the fourth quarter of 2021 is approximately $850 million (pre- and
after-tax), or $4.48 per share.
The Company’s remaining U.S. defined benefit pension plans are
expected to be greater than 95 percent funded after the transfer is
complete.
About Alcoa Corporation
Alcoa (NYSE: AA) is a global industry leader in bauxite,
alumina, and aluminum products, and is built on a foundation of
strong values and operating excellence dating back 135 years to the
world-changing discovery that made aluminum an affordable and vital
part of modern life. Since developing the aluminum industry, and
throughout our history, our talented Alcoans have followed on with
breakthrough innovations and best practices that have led to
efficiency, safety, sustainability, and stronger communities
wherever we operate.
Dissemination of Company Information
Alcoa intends to make future announcements regarding company
developments and financial performance through its website,
www.alcoa.com, as well as through press releases, filings with the
Securities and Exchange Commission, conference calls, and
webcasts.
Forward-Looking Statements
This press release contains statements that relate to future
events and expectations and as such constitute forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. Forward-looking statements include those
containing such words as “ambition,” “anticipates,” “believes,”
“could,” “develop,” “endeavors,” “estimates,” “expects,”
“forecasts,” “goal,” “intends,” “may,” “outlook,” “plans,”
“potential,” “projects,” “reach,” “seeks,” “sees,” “should,”
“targets,” “will,” “working,” “would,” or other words of similar
meaning. All statements by Alcoa Corporation that reflect
expectations, assumptions or projections about the future, other
than statements of historical fact, are forward-looking statements.
Forward-looking statements are not guarantees of future performance
and are subject to known and unknown risks, uncertainties, and
changes in circumstances that are difficult to predict. Although
Alcoa Corporation believes that the expectations reflected in any
forward-looking statements are based on reasonable assumptions, it
can give no assurance that these expectations will be attained and
it is possible that actual results may differ materially from those
indicated by these forward-looking statements due to a variety of
risks and uncertainties. Additional information concerning factors
that could cause actual results to differ materially from those
projected in the forward-looking statements is contained in Alcoa
Corporation’s filings with the Securities and Exchange Commission.
Alcoa Corporation disclaims any obligation to update publicly any
forward-looking statements, whether in response to new information,
future events or otherwise, except as required by applicable
law.
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version on businesswire.com: https://www.businesswire.com/news/home/20211214006034/en/
Investor Contact James Dwyer 412-992-5450
James.Dwyer@alcoa.com
Media Contact Jim Beck 412-315-2909 Jim.Beck@alcoa.com
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