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Restructuring Analysis

Pension Consulting Services group professionals restructuring analysis includes the following representative services:

  • Analysis to support the decision to maintain or terminate sponsors’ pension plans, including calculation of the cash flow and income statement impact on the plan sponsor and its controlled group.
  • Analysis of the impact on creditor recoveries of terminating the pension plan, specifically the trade-off associated with eliminating the future pension funding obligation in exchange for a pension claim and the payment of the DRA premiums (distressed termination premiums).
  • Analysis of the potential priority of any claims in a Chapter 11, both statutorily and structurally.
  • Helping understand and interpret the unique facets of pension funding, including the impacts of legislation (2006 Pension Protection Act, Pension Relief Act of 2010, IRS funding waivers) and changes in actuarial assumptions (e.g., discount rate, assumed asset return, smoothing of actuarial gains/losses, etc.).
  • Helping understand and interpret PBGC §4043 reportable events and reporting requirements, including Forms 5500, 4010 and termination notices, and the ability to incorporate the information from these sources into the economic analysis.
  • Performance of these analyses on companies with complex corporate and capital structures.
  • Analysis of whether a distressed termination application satisfies one or more of the four-point criteria used by the PBGC to evaluate whether a distressed termination is warranted and the application of these criteria to members of the control group; and
  • Evaluation of whether an involuntary termination is warranted (1) due to the factors under which PBGC may terminate a pension plan (e.g., minimum funding requirements not met, inability to pay benefits as they become due, etc.) and/or (2) to prevent the unfunded pension obligation from increasing due to changes in the financial health of the plan sponsor, additional benefit accruals and/or deterioration in plan assets.
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