Business News : GM to cut 24 percent of U.S. pension liability

DETROIT (Business News) - General Motors Co (GM.N) will offer some U.S. white-collar retirees a lump-sum pension buyout as part of two actions announced on Friday that will slash 24 percent of its U.S. pension obligations.

The largest U.S. automaker said it will offer lump-sum payments to 42,000 salaried retirees and surviving beneficiaries.

GM will also buy a group annuity contract from Prudential, which will now pay and manage future benefit payments to GM's remaining salaried retirees.

The two moves affect 118,000 U.S. salaried retirees. Both transactions are expected to be completed at the end of this year and will cut $ 26 billion from GM's pension obligation.

The company's total pension obligation in the U.S. of nearly $ 109 billion is a major concern for its investors and is one of a handful of issues that was untouched during the Obama administration's bailout of the automaker in 2009.