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News & Policy

PBGC Hails Continuation of AbitibiBowater Pensions

November 23, 2010

WASHINGTON-Josh Gotbaum, Director of the Pension Benefit Guaranty Corporation, issued the following statement today on the confirmation of AbitibiBowater Inc.'s bankruptcy restructuring plan that retains all four of the company's pension plans:

"Instead of ending its pensions AbitibiBowater will keep them going. This is good news for the company's 10,000 workers and retirees in the United States. They will keep their full retirement benefits under the protection of the PBGC's insurance guarantee. It's also good news because it keeps more than $380 million in underfunding from the PBGC's books. Our legal and financial team has worked step-by-step with the company to make this outcome possible."

Since Oct. 1, 2009, the agency has worked with more than 40 companies to help them reorganize with ongoing pension plans. Nearly 300,000 workers and retirees will continue to enjoy the full retirement benefits they were promised.

AbitibiBowater is a pulp and paper manufacturer based in Montreal. On April 16, 2009, the company sought Chapter 11 protection in the U.S. Bankruptcy Court in Delaware.

The PBGC is a federal corporation created under the Employee Retirement Income Security Act of 1974. It currently guarantees payment of basic pension benefits earned by 44 million American workers and retirees participating in over 27,500 private-sector defined benefit pension plans. The agency receives no funds from general tax revenues. Operations are financed largely by insurance premiums paid by companies that sponsor pension plans and by investment returns.

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PBGC No. 11-13