Unisys Transfers A Portion Of Its U.S. Defined Benefit Pension Obligations To F&G Through $250M Of Group Annuity Contracts
Portfolio Pulse from Benzinga Newsdesk
Unisys Corporation (NYSE:UIS) has transferred a portion of its U.S. pension obligations to F&G Annuities & Life, Inc. (NYSE:FG) through the purchase of group annuity contracts worth $250 million. This move, which affects about 3,900 retirees, is part of Unisys's strategy to reduce pension liabilities and volatility without impacting retirees' payment amounts or timing. The transaction will result in a one-time, non-cash, pre-tax settlement charge of approximately $244 million for Unisys, but will not affect the company's cash position.
November 27, 2023 | 1:39 pm
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NEUTRAL IMPACT
F&G Annuities & Life, Inc. has taken on pension obligations from Unisys through the purchase of group annuity contracts, expanding its liability portfolio without immediate cash impact.
F&G's acquisition of pension obligations from Unisys increases its liability portfolio, which is typical for insurance companies in the annuity business. This may not have a significant short-term impact on the stock as it aligns with F&G's business model and does not involve immediate cash expenditure.
CONFIDENCE 85
IMPORTANCE 50
RELEVANCE 60
NEUTRAL IMPACT
Unisys Corporation has transferred pension obligations to F&G, incurring a one-time charge of $244M but maintaining its cash position. This de-risking move is part of ongoing efforts to manage pension liabilities.
The transfer of pension obligations is a strategic financial move that does not directly affect Unisys's operations or cash flow. The one-time charge may not significantly impact investor sentiment as it is non-cash and expected in such transactions. The action reflects prudent financial management and may be viewed neutrally by the market.
CONFIDENCE 90
IMPORTANCE 70
RELEVANCE 80