PBGC will pay retirement benefits for more than 650 current and future retirees of Allied Systems Holdings Inc., a vehicle transportation business based in Atlanta, Ga.
The agency stepped in because Allied Systems is selling the majority of its assets in bankruptcy proceedings and potential buyers haven't agreed to continue the company's three single-employer pension plans.
PBGC will pay all pension benefits earned by Allied Systems retirees up to the legal limit of about $57,500 for a 65-year-old.
Retirees will continue to get benefits without interruption, and future retirees can apply for benefits as soon as they are eligible.
According to PBGC estimates, Allied Systems plans are collectively 58 percent funded with $45 million in assets to pay $78 million in benefits. The agency expects to cover the entire $33 million shortfall.
PBGC can provide general information now and will be able to answer more detailed questions once we receive the pension plan records. Participants in the company's plans will be notified by letter after the transfer occurs.
For additional information, please email us at email@example.com or call 1-800-400-7242 (8 a.m. to 7 p.m. EST, Monday - Friday) (TTY/ASCII: call 1-800-877-8339 and ask to be connected to 1-800-400-7242).
Additionally, Allied Systems retirees who get their pension from PBGC may be eligible for the federal Health Coverage Tax Credit. For more information, see PBGC's Health Coverage Tax Credit (HCTC) FAQs.
Allied Systems and its affiliate Allied Systems Ltd. were placed into Chapter 11 protection in the U.S. Bankruptcy Court in Wilmington, Del., by its creditors on May 17, 2012 through an involuntary bankruptcy filing. The company and Allied Systems Ltd. later converted the case to a voluntary bankruptcy and placed 17 of its affiliates in Chapter 11 in the same court. In the past few months, Allied Systems has said it plans to sell the majority of its assets in bankruptcy court.
The company is the parent of several units that transport cars, light trucks, and sport-utility vehicles from manufacturing plants, ports, auctions, and railway distribution points to dealerships in the U.S. and Canada.
Interested in more blog posts like this one? Sign up to receive updates from Retirement Matters.