RT Journal Article
SR Electronic
T1 Divesting to Create Shareholder Value: <em>Pension Plans Through a Divestment Lens</em>
JF The Journal of Investing
FD Institutional Investor Journals
SP 81
OP 84
DO 10.3905/joi.2018.27.supplement.081
VO 27
IS supplement
A1 Rohit Mathur
A1 Glenn O’Brien
YR 2018
UL https://pm-research.com/content/27/supplement/81.abstract
AB Evidence demonstrates that capital markets reward companies that divest non-core operations and unprofitable segments, particularly if the transaction improves the performance of the company’s remaining operations. Much like an unprofitable business segment, defined benefit pension plans divert resources from the core business, constrain cash flows, and limit performance. Since decisions to divest and decisions to de-risk a pension obligation are driven by the same factors, pension risk transfer should be looked at through a divestment lens.TOPICS: Pension funds, risk management, security analysis and valuation