Executives for Chicago-based Hartmarx Corp.'s $185 million defined benefit pension fund cut the fund's U.S. equity exposure to 60% from more than 70%, but probably will increase holdings of Hartmarx company stock.
James Condon, vice president and treasurer, said the fund's allocation to Hartmarx stock probably will jump to 8% to 10% of assets from 5%. He said the Hartmarx fund probably will buy about 600,000 shares as a follow-up to its purchase of about 400,000 shares already this year.
The current market price appears attractive to fund executives - Hartmarx closed at 71/2 July 11 - and they have gains on shares already bought for a little more than $5 per share earlier this year.
Moreover, the fund has begun a search for an international equity manager to run about 6% of the fund, and will begin a search for a U.S. fixed-income manager to run about 8% of the fund later this summer, Mr. Condon said. In anticipation of the hires, the fund has about 20% in cash reserves.
Brinson Partners, Chicago, manages 60% of the fund in a combination of global stocks and bonds, and venture capital, he said. Brinson has discretion to adjust the allocation between various asset classes, and has outperformed its own multimarket benchmark, he said. Phoenix Duff and Phelps, Hartford, Conn., runs 6% of the fund in growth stocks, and GAMCO manages about 9% in a type of special situation equity investment style.
Mr. Condon said the international equity search should be completed in early August. The domestic fixed-income manager search will begin in early September, and he said he hopes to complete it by year end. The searches are being done internally.
