Athene in significant pension risk transfer transaction with Bristol-Myers
December 5, 2018 by Athene Holding
Athene Holding (ATH) announced a first-of-its-kind pension plan termination transaction with Bristol-Myers Squibb (BMY) covering more than 24,000 active employee participants, retirees, beneficiaries, and former Bristol-Myers Squibb employees who have not yet commenced their benefits. Under the agreement, Athene’s wholly-owned Iowa-domiciled life insurance subsidiary, Athene Annuity and Life company, agreed in advance to provide an annuity contract covering all obligations of Bristol-Myers Squibb’s U.S. Retirement Income Plan for which the plan participants do not elect to receive a lump sum payment. Subsequent to payout of the lump sum obligations in July 2019, it is expected that AAIA’s annuity contract will cover as much as $3.8B of remaining pension liabilities when the transfer is completed in August 2019, subject to customary closing conditions. “We are pleased to have been selected as a trusted partner by Bristol-Myers Squibb, a global leader in the biopharmaceutical industry, to serve all of their U.S. Plan participants through this innovative transaction,” said Sean Brennan, Senior Vice President and Head of Pension Risk Transfer at Athene. “This transaction represents the largest full-plan termination to date that includes both retirees and non-retirees, and we believe this approach may provide a blueprint for plan sponsors considering full plan terminations in the future.” Upon completion of the transaction, Athene will provide irrevocable commitments to all Plan participants and will assume full financial responsibility, including required administration, for annuity and lump sum payments. Plan participants have received information packages and do not need to take any action at this time. “As a leader in pension risk transfers, Athene is able to provide plan sponsors with customized solutions to achieve their desired pension risk and financial objectives while ensuring the financial security of their plan participants,” said Bill Wheeler, President of Athene. “Our differentiated investment, actuarial, risk-management, and operational capabilities, combined with our strong balance sheet, position us well to serve the $3 trillion defined benefit marketplace.” Athene is a leader in the pension risk transfer industry, managing pension payments for more than 80,000 annuitants. During 2018, Athene has closed six pension risk transfer transactions totaling more than $1.8 billion.
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