U.S. Steel Announced Further Strengthening of Balance Sheet

SEATTLE (Scrap Monster): Pittsburgh-based United States Steel Corporation (U.S. Steel) announced that the recent purchase of group annuity contracts from Banner Life Insurance Company and William Penn Life Insurance Company of New York by the company will lead to further strengthening of its balance sheet. Accordingly, around $284 million of the company’s pension plan obligations will be transferred.

The deal will transfer administrative and benefit-paying responsibilities for approximately 17,800 U.S. retirees and beneficiaries. The payment to benefits to certain retirees and beneficiaries in the Plan for Employee Pension Benefits (Revision of 2003) will start beginning next year. The transaction will not bring about any change to the pension benefits, said the company press release.

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The transaction is expected to recognize a non-cash pension settlement charge of approximately $110 million.

 David B. Burritt, President and CEO, U.S. Steel noted that the transaction is yet another meaningful step in strengthening the company’s balance sheet and further de-risking its pension plan. The purchase will be funded directly by the assets of the pension plan, he added.

The company had reported record third quarter results, posting net earnings of $2.002 billion or $6.97 per diluted share.