Crown to transfer $740 million in U.S. Pension Plan obligations.

Crown Holdings, Inc. announced that it has signed an agreement to acquire a group annuity contract with Massachusetts Mutual Life Insurance Company (MassMutual) to fully guarantee the benefits covered by the contract for nearly all retirees and deferred vested participants in its major U.S. defined benefit plans.

The transaction provides a policy covering the benefits of approximately 12,000 participants.

“We are carefully transferring portions of our pension obligations to MassMutual, a highly rated and experienced provider of insurance and retirement benefits,” said Kevin Clothier, Senior Vice President and Chief Financial Officer.

“Upon completion of the transfer, Crown will eliminate approximately $740 million in both pension plan assets and liabilities in the U.S. Combined with previous purchases in Canada and the U.K., the company will have written off approximately $4 billion in pension liabilities since 2021. This transaction further strengthens Crown’s balance sheet, significantly reduces future earnings and cash flow risk, and keeps benefits secure for our pension plan participants.”

MassMutual will begin making payments to participants effective November 1, 2024. Benefits payable to retirees and other plan participants will not be affected by the transaction.

The company expects to contribute approximately $100 million to the plan and record a one-time non-cash charge of approximately $450 million ($340 million after-tax) in the third quarter of 2024 as part of the plan agreement. The company reaffirms its full-year 2024 adjusted free cash flow forecast of at least $750 million.