September 5, 2006
Mr. Ken Raschke
I am responding to your email correspondence of Friday, August 11, 2006 on behalf or John Hickey and Collette Chilton. You asked:
During the quarter ended June 30, 2006, Lucent reduced the allocation to equities in the Master Pension Trust from approximately 75% equities/ 25% fixed income to about 50% equities/ 50% fixed income. You are correct:
The assets in this pension plan are currently well in excess of the liabilities and the plan fiduciaries, acting in consultation with advice from an independent external asset allocation advisor, determined that the higher allocation to fixed income securities would be in the best interest of plan participants.
Lucent Technologies has disclosed publicly the reduction in the allocation to equities in the Master Pension Trust and that this shift in asset allocation from equities to fixed income related to the occupational pension plan. The assets of the LRIP will continue to be held in the Lucent Master Pension Trust and, of course, will be separately reported on the Form 5500 for that plan.
3. What will be the new asset allocation profile of LRIP assets?
Lucent Technologies disclosed publicly that the shift in asset allocation from equities to fixed income securities related to the occupational plans. The allocation of the LRIP assets remain at approximately 75% equities/25% fixed income.
Mary Lou Ambrus