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PBGC Steps in to Oversee Sears' Two Pension Plans

Submitted by jhartgen@abi.org on

The Pension Benefit Guaranty Corp. (PBGC) said that it is taking steps to assume responsibility for bankrupt retailer Sears Holdings Corp.’s two pension plans, covering about 90,000 people, Reuters reported. The agency said that it is stepping in to oversee the retirement benefits of employees and retirees at Sears, Roebuck and Co and Kmart Corp as it is clear that Sears' continuation of the plans is no longer possible. Sears Holdings, which filed for bankruptcy in October, said on Thursday that Chairman Eddie Lampert won an auction to buy the once iconic U.S. retailer after presenting an improved offer of $5.2 billion. The PBGC estimates Sears’ pension plans are underfunded by $1.4 billion, leaving them 64 percent funded. The agency said that it is seeking to end plans as of Jan. 31 and added it would become responsible for the pension plans when Sears agrees or a court orders plan termination.