Sale of division

Pension Benefit Guaranty Corporation 76-52 April 14, 1976 RE FERENCE: [*1] 4 043(b)(3) Reportable Events. Decrease in Participants404 3(b)(8) Reportable Events. Mergers, Consolidations & other Transfers of Plan Assets OP INION: This is in response to your request for a rul ing regarding the effect under Title IV of the Employee RetirementInc ome Secu rity Act of 1974 (the Act) of the pending sale of three commonly located divisions of * * * (the Company). Th is response is based upon all submissi ons made to the Pension Benefit Guaranty Corporation (the PB GC) on bahalfof th e Company. The Company ma intains two plans, the Retirement Income Plan, and the * * * Retirement Plan forSalari ed Employees, each of which will experience a reduction in the number of part icipants as a result of the sale. The facility being sold accounted for greater than 20% of the active participants in each plan. As we understand the facts , substantially all of the Company employees at the facili ty, who were parti cipants underthe Reti rement Income Plan, will become employees of the Buyer of the three divisions, * * * now know n as * * * (t heBuyer). Th e Buyer is adopting a substantially identical plan for all of these former * * * employees and is continuing the ope rations at the facility. [*2] Plan assets allocable to the participants of the sold facil ity will be transferred to theplan c ontinued by the Buyer. As to the * * * Reti rement Plan for Salaried Employees, more than 20% of the total number of its active participantswill no lon ger be active participants under the plan as a consequence of the sale. Th e Buyer is adopting a similar planfor these employees and substantially all of them will be employed by the Buyer, who is continuing operation of the facility. Assuming that each plan is covered by Section 4021 of t he Act, the following are the Title IV consequences: (1)As to th e Retirement Income Plan there occur reportable e