By Josh Beckerman

 

Kroger Co., Stop & Shop and Albertsons Cos. have tentatively agreed to withdraw from a United Food and Commercial Workers International Union pension plan.

Kroger and Stop & Shop have agreed to transition to a new variable annuity pension plan for 33,000 Kroger workers and 18,000 Stop & Shop employees.

Albertsons workers would transition to another variable annuity pension plan. The changes are subject to ratification by union members.

Kroger said "in an environment where pensions are faced with funding challenges, we are pleased to have reached a tentative agreement that will protect benefits for our associates." The plan would help Kroger "by addressing future pension cost increases and minimizing Kroger's future exposure to market risk associated with the current pension plan."

Kroger expects withdrawal liability and contribution to a transition reserve would total about $760 million after-tax. Stop & Shop, a unit of Ahold Delhaize, expects its total will be about $500 million.

Albertsons expects an after-tax charge of about $213 million for withdrawal liability and expects to pay about $8 million to $9 million to pre-fund a transition reserve.

 

Write to Josh Beckerman at josh.beckerman@wsj.com

 

(END) Dow Jones Newswires

July 21, 2020 19:12 ET (23:12 GMT)

Copyright (c) 2020 Dow Jones & Company, Inc.
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