Effective January 1, interest rates tied to corporate bonds will be used to calculate the lump-sum pension payouts and certain annuity payout options, according to the memo. The company had used the average of the 30-year U.S. Treasury bond rates for the months of August and September to determine the payouts.
“Even with these changes, Anheuser-Busch will continue to offer a very fair plan, with retirement benefits above the 75th percentile of our corporate peers,” Farrell said in the memo.
The memo also lays out an early retirement program that is not tied to the lump-sum payout change and says the company will reduce its long-term incentive program, which includes stock options and restricted stock, by 20 percent to 40 percent.
Anheuser-Busch is trying to prevent a takeover by Belgium-based InBev. It plans to reduce costs in an effort to try to convince investors that InBev’s offer is too low.
Anheuser-Busch on June 11 received an unsolicited, nonbinding proposal from InBev to acquire all the outstanding shares of Anheuser-Busch for $65 per share, or $46.35 billion, in cash. The stock closed at $62.21 on Monday, June 30, on the New York Stock Exchange.
Filed by Pensions & Investments, a sister publication of Workforce Management. To comment, e-mail email@example.com.