Annuity buy-in deal finalizes pension security and ends uncertainty for Fraser Papers plan members
More than $114m in pension obligations for former Fraser Papers Inc. employees have been secured through two annuity buy-in transactions completed by Sun Life Financial Inc. with the Board of Trustees of the two New Brunswick shared risk plans.
This agreement, advised by Paul Chang Consulting, enables the termination of the shared risk plans and concludes the Companies' Creditors Arrangement Act (CCAA) process that began when Fraser Papers filed for creditor protection in 2009.
The transaction required collaboration between Sun Life, the two Boards of Trustees, and their consultant, resulting in a tailored approach that maximized benefit levels and optionality for plan members.
Paul McKinley, board chairman of the Fraser Salaried Pension Plan, said that Paul Chang Consulting provided advice that helped the board achieve its intended outcome for plan members efficiently.
He also noted Sun Life’s cooperation and flexibility during the process.
Mathieu Tessier, vice-president at Sun Life, stated that the company helped secure benefits for Fraser Papers’ plan members.
He explained that the transaction demonstrates Sun Life’s approach to developing solutions that protect pensioners, even in complex situations.
Sun Life will provide uninterrupted payment of monthly pensions for plan members.
Since 2008, more than $70bn in pension obligations have been transferred to insurers across the industry. Sun Life has received more than $22bn of these pension obligations over 17 years.
