This past Tuesday at Goldman Sachs' Communacopia Conference, AT&T (T) CEO Stephenson said the company's pension plan will be "fully funded" at the end of 2013. Stephenson was referring to AT&T's application for exemption from the Department of Labor's ERISA and associated IRC requirements, which is open for comment by stakeholders until November. It proposes to create, value, and issue 320,000,000 of $25 liquidation value preferred shares from its wholly owned subsidiary, AT&T Mobility, to itself.
AT&T will then subsequently contribute these shares to its pension plan. The pension plan will then hold employer securities in excess of the 10% fair market value of assets currently allowed by ERISA. Thus, AT&T will need an exemption similar to those granted to Northwest (which merged with Delta Air Lines (DAL) in 2008), General Motors (GM), and Kaiser Aluminum (KALU) -- all of which have declared bankruptcy. AT&T says it needs to make this contribution because it cannot contribute this amount of cash. Read more
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