Kroger to make $1 bln contribution to its benefit plans


UPDATE 1-Kroger to make $1 bln contribution to its benefit plans

(Adds details, shares)
    July 17 (Reuters) - Kroger Co <KR.N>, the biggest U.S.
supermarket operator, said on Monday it would make a
contribution of up to $1 billion to its under-funded benefit
    The company will issue debt to pay for its pension
liability, Kroger said in a regulatory filing, adding its
overall balance sheet obligations will not change. (http://bit.ly/2u0MKRP)
    Kroger said contributions to the plan are "strategic
opportunities" due to the current interest rate environment and
potential changes to the U.S. tax code, among others.
    Certain benefit balances of the fund could be transferred to
other retirement plan options or a lump sum payout.
    Kroger, which had total debt of $13.44 billion as of May 20,
said it would incur a one-time expense following the settlement,
but noted that the expense would not affect its 2017 earnings
    Last month, Kroger slashed its full-year earnings forecast
as inventory accounting charges and labor costs rose amid an
intensifying price war. [nL3N1JC412]
    The company, which has been looking for ways to cut costs as
it selectively raises wages to retain workers, last month said
talks with labor unions would be challenging as it aims to
maintain "competitive cost structures".
    Shares of the grocer were flat in early trading on Monday.

 (Reporting by Divya Grover in Bengaluru; Editing by Shounak
 ((Divya.Grover@thomsonreuters.com; within U.S. +1 646 223 8780,
outside U.S. +91 80 6749 3859; Reuters Messaging:


This article appears in: Stocks , Politics
Referenced Symbols: KR

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