Deals & People February 7, 2014

Gallagher Appoints New Regional President

Nick Davies will assume the role of area president for Gallagher Fiduciary Advisors LLC’s (GFA) Washington, D.C., and Newark, New Jersey, offices.
Reported by

GFA offers institutional investment and fiduciary adviser services as a subsidiary of Gallagher Benefits Services Inc.

Davies joined GFA in 2013 as a senior consultant focusing on client service and firm management. He has over 16 years of pension and investment experience, the firm says. Before Gallagher, Davies served as the U.S. defined benefit segment leader within Mercer’s investments business, focusing on pension risk solutions and alternative investments.

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Davies also brings a plan sponsor perspective to GFA, the firm says. As a former senior investment officer for the board of investment trustees in Montgomery County, Maryland, he helped oversee approximately $3 billion in public pension assets.

Samuel Halpern, current area president for the Washington, D.C., and Newark offices, will step back from internal management responsibility at GFA, but will continue to advise select clients across GFA’s services, the firm says.

Davies joins GFA as a chartered alternative investment analysts (CAIA).

Compliance February 7, 2014

PBGC to Cover Corporate Pension Shortfall

The Pension Benefit Guaranty Corporation (PBGC) will pay retirement benefits for a plastic container manufacturer based in Trevose, Pennsylvania.
Reported by

More than 4,400 current and future retirees of Constar Inc. will be assisted by the PBGC as a result of the company selling most of its assets in bankruptcy proceedings and the buyer choosing not assuming responsibility for the existing pension plan.

The PBGC says it will pay all pension benefits earned by Constar’s retirees up to the legal limit of about $59,320 for a 65-year-old. Current retirees will continue to get benefits without interruption, and future retirees can apply for benefits as soon as they are eligible.

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The Constar Inc. Pension Plan is 66% funded with $89.6 million in assets to pay $135 million in benefits, according to PBGC estimates. The agency expects to cover $44.7 million of the $45.4 million shortfall.

After losing Pepsi, its largest customer, Constar and its affiliates sought Chapter 11 protection in the U.S. Bankruptcy Court in Wilmington, Delaware, in December 2013. The company intends to sell the majority of its assets in two separate auctions—one for its domestic assets, and the other for the assets or stock of its affiliates in the United Kingdom and Holland.

Currently, the lead bidder is Amcor Rigid Plastics USA, Inc. The auctions were held on February 6. The sales hearing is scheduled for February 10.

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