NEW YORK, Oct. 20 (UPI) -- U.S. telecommunications giant AT&T said it planned to use preferred equity shares to contribute $9.5 billion to a retirees' pension trust fund.
The plan requires approval from the Labor Department, which will review the risk associated with a pension fund contribution that could lose value should the company's share values decline, The Wall Street Journal reported Saturday.
However, AT&T is a large, stable company whose share values are unlikely to collapse, the newspaper said.
The company said in a regulatory filing it has 240,000 employees. The pension plan affects 600,000 of its retirees, the Journal said.
The contribution "means a strong future for the fund" said the Communications Workers of America, the union that represents hundreds of thousands of AT&T workers and retirees.
AT&T was making the move "at a time when some companies are eliminating or underfunding their pension plans," a union spokeswoman said.
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