Hartmarx underfunded pension plan assumed by PBGC following sale

By Caroline Salls

Pittsburgh, Jan. 11 - Hartmarx Corp.'s underfunded pension plan has been assumed by the Pension Benefit Guaranty Corp., according to a PBGC news release.

The plan, which ended on Aug. 7, covers nearly 13,000 former Hartmarx workers and retirees.

The PBGC said it stepped in because the plan faced abandonment after the company sold all of its assets to purchasers who did not assume responsibility for financing or administering the plan.

The Hartmarx Retirement Income Plan is 47% funded, with assets of $142.8 million to cover $306.6 million in benefit liabilities, according to PBGC estimates.

The agency said it expects to be responsible for $158.5 million of the $163.8 million shortfall.

The PBGC will take over the assets and use insurance funds to pay guaranteed benefits earned under the plan.

Hartmarx, a Chicago-based producer and marketer of business, casual and golf apparel, filed for bankruptcy on Jan. 23, 2009 in the U.S. Bankruptcy Court for the Northern District of Illinois. Its Chapter 11 case number is 09-02046.

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