Interstate says Florida, Georgia consolidation may significantly hike pension liability

By Ted A. Knutson

Washington, April 27 - Interstate Bakeries Corp. announced plans to consolidate its Florida and Georgia operations. The move could save money by cutting 600 jobs, but Interstate warned the action could "significantly increase" unfunded pension liabilities if the firm is found to have partially withdrawn from multi-employer pension plans.

Interstate noted the company could face $530 million in liabilities if it withdraws completely from the largest Bakery & Confectionary Union & Industry International Pension Fund and Central States, Southeast and Southwest Areas Pension Plans.

The company said it has no plans to totally withdraw. However, Interstate said some of the 40 multi-employer pension plans it participates in claim partial withdrawals have occurred.

The company estimated the immediate costs of the layoffs and closure of its Miami bakery at $10 million.

The Kansas City, Mo., baker filed for Chapter 11 U.S. Bankruptcy Court for the Western District of Missouri on Sept. 22, 2004. Its case number is 04-45814.

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