PBGC to Take Over Petrie Stores Pension Plan
FOR IMMEDIATE RELEASE
January 01, 1998
The Pension Benefit Guaranty Corporation (PBGC) today announced it will take over the pension plan of bankrupt Petrie Retail, Inc., Secaucus, N.J., to protect about 5,600 workers and retirees. The plan is underfunded by approximately $14 million.
"Petrie store workers will receive pensions when they retire because their pension plan is insured by the PBGC," said PBGC Executive Director David M. Strauss. "And workers already retired will continue to receive their benefit checks without interruption."
Closely-held Petrie formerly operated 1,700 women's clothing stores in 49 states under the names Petrie, Marianne's, Jean Nicole, Stuart's, G&G/Rave and Winkelman's. To date, Petrie has sold or closed over 1,000 stores. The company's reorganization plan calls for about 100 stores to operate, mainly in Michigan, south Florida, Puerto Rico and the U.S. Virgin Islands.
PBGC acted after the U.S. Bankruptcy Court for the Southern District of N.Y. approved Petrie's motion to terminate the pension plan as part of the company's plan of reorganization. The pension plan has assets of about $46 million and liabilities of almost $60 million.
PBGC terminated the Petrie pension plan effective May 19, 1998, the date specified by the company in a letter sent to participants telling of its intent to end the plan. When a pension plan terminates, workers can no longer earn more benefits.
Nearly all workers, except for a few highly compensated individuals, are expected to receive full benefits from PBGC. The maximum pension benefit guaranteed for workers in plans that terminate in 1998 is $2,880.68 a month (approximately $34,568 a year) for persons who retire at age 65 or older. The guarantee is lower for those who retire early or have survivor's benefits.
Workers and retirees do not need to take any action. Those wishing to retire or anyone with questions about benefits may contact PBGC's Customer Service Center at 1-800-400-7242. For TTY/TDD users, call the federal relay service toll-free at 1-800-877-8339 and ask to be connected to 800-400-7242.
PBGC is a federal corporation created under the Employee Retirement Income Security Act of 1974 to guarantee payment of basic pension benefits earned by about 42 million American workers and retirees participating in about 45,000 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 investment returns.
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PBGC No. 98-30