PBGC will pay retirement benefits for more than 900 current and future retirees of Vertellus Specialties Inc., a manufacturer of specialty chemicals based in Indianapolis, Ind.
The company sponsors the Vertellus Specialties Inc. Defined Benefit Retirement Plan.
PBGC is stepping in because Vertellus and 10 affiliates intend to sell the majority of their assets in bankruptcy proceedings and the potential buyer will not continue the pension plan.
The company's plan will end on Sept. 6, 2016. A hearing is slated for Sept. 7, 2016, to approve the sale of assets.
PBGC will pay all pension benefits earned by the plan's retirees up to the legal limit of $60,136 a year 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.
Employees and retirees who are participants in the pension plan will continue to receive benefits from the company until PBGC assumes responsibility.
Vertellus retirees who will draw a benefit from PBGC may be eligible for the federal Health Coverage Tax Credit (HCTC). Further information may be found on PBGC's HCTC webpage.
According to PBGC estimates, the Vertellus plan is 59% funded with $52.4 million in assets to pay $88.4 million in benefits. The agency is expected to cover $35.8 million of the $36.0 million shortfall.
Vertellus and its affiliates manufacture specialty chemicals that are used in agricultural and nutritional products worldwide. Vertellus and its affiliates also make a range of items for personal care, pharmaceuticals, and other industrial uses. On May 31, 2016, Vertellus and 10 affiliates filed for Chapter 11 protection in the U.S. Bankruptcy Court in Wilmington, Del.
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