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Press Releases by Date   |   Press Releases by Company Name


View More Press Releases by MassMutual

Press Release

Arconic Reduces Gross Pension Obligation by $1 Billion with Purchase of Group Annuity Contract

Issued by MassMutual

May 2, 2021

April 30, 2021 - Arconic Corporation (NYSE: ARNC) (“Arconic” or “the Company”) announced today it has purchased a group annuity contract from Massachusetts Mutual Life Insurance Company (“MassMutual”) and transferred approximately $1 billion of the Company’s U.S. pension plan obligations and related plan assets to MassMutual.

Arconic Chief Executive Officer Tim Myers said, “We are thoughtfully moving portions of our pension obligation to MassMutual, a highly-rated, well-respected insurance company, to preserve benefits to our retirees and their beneficiaries while maintaining the funded status of the remaining plan obligations. The transaction represents the latest step in our ongoing effort to reduce legacy liabilities and the volatility associated with factors beyond our control.”

The group annuity contract results in the transfer of responsibility for remaining pension benefit payments to MassMutual for approximately 8,400 Arconic retirees or beneficiaries. Participants will continue to receive their benefits from the Company’s plans through July 2021, after which MassMutual is expected to begin making benefit payments. There will be no change to the pension benefits for any plan participants as a result of the transaction. Details will be provided to retired participants and beneficiaries whose continuing payments will be fulfilled by MassMutual.

As part of the transaction, Arconic made a $250 million contribution to its U.S. pension plans to maintain the funding level of the remaining plan obligations. This contribution was funded with proceeds from the previously announced debt offering of $300 million aggregate principal amount of the Company’s 6.125% Senior Secured Second-Lien Notes due 2028, which closed on March 3, 2021.

As a result of the transaction, the Company expects to recognize a non-cash pension settlement charge of approximately $575 million ($450 million after tax), subject to finalization of actuarial assumptions and other applicable adjustments in the second quarter of 2021.

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