Assumption of Pension Liabilities

First, also determine the trust assets and the amount. Next determine the benefit formula and actuarial assumptions. Get a coy of their ERISA filings inclding statutory "funded status". If you have to take a large unfunded liability, consider abandoning the deal unless price is adjusted. Note that you will generally have the right to freeze or terminate the acquired plan, unless you give that up in negotiations. Have an actuary and a knowledgeable financial professional, as well as your attorney.

I would echo Barrett's response, plus add that you get copies of all the Pension Plan audit reports. If those have not been prepared, then make it a part of the Due Diligence and/or Closing process that those be prepared. In all the deals that I have been a part of that had DB Pensions, I was lucky that they where fully funded, but if it had not been the case, I would have required that all contributions need to bring the fund(s) to full funding would be a requirement at the escrow table; that the required funds to fully fund be withheld at the escrow table and remitted to Trustee.