WASHINGTON, D.C. - The U.S. Pension Benefit Guaranty Corporation (PBGC), a government-ran agency, has announced it will be picking up the pension plans of more than 21,000 retirees of the now shut down A&P retail chain.
“PBGC is stepping in because A&P has sold the majority of its assets in bankruptcy proceedings and most of the buyers declined to keep the plans going,” the agency said in a press release. “The agency will pay all pension benefits earned by A&P retirees up to the legal maximum of $60,136 a year for a 65-year-old.”
The PBGC will be taking over the following plans:
- The Great Atlantic & Pacific Tea Co. Inc. Plan, which has 14,783 participants and a $109.4 million shortfall. PBGC will cover $105.6 million of that shortfall.
- The Pathmark Stores Inc. Pension Plan. The PBGC will cover that plan's entire $182.3 million shortfall.
- The Delaware County Dairies Inc. Hourly Employees Pension Plan, which owes participants $100,000 in benefits. The PBGC will cover that amount.
Following A&P’s file for bankruptcy in July of last year and the sale of all of its locations, the company was able to raise more than $900 million to pay off loans and debt. However, as Lohud.com reports, a shortfall of a combined $291 million has kept A&P from being able to fulfill all its promised pension benefits.
While the PBGC will be picking up the three plans listed above, the remaining New York-New Jersey Amalgamated Pension Plan for A&P Employees has not been terminated and will be administered by UFCW Local 464A in Little Falls, and Acme Markets Inc.
