Intrenet Takes Second-Quarter Loss

Intrenet Inc., Milford, Ohio, said it expects to post a net loss of between $2 million and $3 million in the second quarter of 1999 in part because of a pending settlement of withdrawal liability claims filed by the Central States Southeast and Southwest Pension Fund.

The Central States Fund, which provides retirement benefits to Teamsters members in trucking and other industries, claims the company owes $3.7 million, plus accrued interest of $1.7 million, based on the withdrawal of RW Service System from the fund in 1992. RW was an indirect subsidiary of Intrenet's predecessor, Circle Express, from March 1985 until April 1998, when it was sold along with other businesses.

Intrenet has said it is not liable to the fund for any of RW's withdrawal liability. The company has, however, made interim payments of about $1.6 million to the fund while the case is being litigated.

Central States and Teamsters union officials are also examining the issue of withdrawal liability in connection with the closing of Preston Trucking Co., which ceased operating in July one year after being spun off to a management group by Yellow Corp. (8-9, p. 1).

Under the Multi-employer Pension Plan Amendments Act of 1980, if an employer withdraws from participation in a multi-employer pension plan, such as the Central States Fund, the employer is jointly liable for a portion of the plan's unfunded vested pension liability.

Central States, the largest of several multi-employer pension funds with more than 450,000 participants and net assets of $18.2 billion, has unfunded pension liabilities estimated to be $1.98 billion, according to Herve H. Aitken Jr., a lawyer in Alexandria, Va., who monitors pension issues.

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