Changes at NYS Teachers
The one-year agreement begins Feb. 1. BARRA RogersCasey's contract was not renewed.
The board also terminated its agreement with Putnam Institutional Management, which managed $450 million in global fixed income for the fund. The fund's three other global fixed-income managers will take over the assets. A spokeswoman from Putnam would not comment.
The system also hired Capital Guardian, Lazard Asset and Bank of Ireland to run up to $330 million each in active international equities in MSCI-EAFE countries. Each firm has a one-year contract. Funding will come from reductions in allocations to passive international equity managers.
The board also ratified approval of a handful of commingled fund investments, which are subject to the completion of appropriate due diligence. Emerging Markets Real Estate Fund II, Peabody Global Partners and Lone Star II each is slated to receive up to $50 million. Lend Lease Global Properties also will receive up to $50 million, subject to the completion of Institutional Property Consultant's review and positive recommendation.
The board also authorized a search for an external active domestic large-cap equity manager. Mercer will assist.
3 quit McKinley
Three McKinley Capital Management staff members have left to start Somerset Quantitative Strategies, a hedge fund targeting institutional investors.
Chris Guptill, chief investment officer of Somerset, had been McKinley's equity strategist. He said he resigned from McKinley in August, then stayed on as a consultant. McKinley executives, in a statement, said they had terminated him because they had "lost all confidence in Mr. Guptill's ability to meaningfully contribute to the firm's investment performance record." Thomas Willison, an outside director at McKinley, said Mr. Guptill "didn't fit our style of work." Mr. Guptill agreed that McKinley ultimately terminated him as consultant, but said it was because he was starting his own firm.
Dan Barnett, formerly marketing director at McKinley, is Somerset's president and chief executive officer; Don Smiley, formerly director of research at McKinley, has the same title at Somerset. The trio's duties at McKinley were assumed internally.
The $250 million Agway pension fund hired two new managers and awarded new mandates to three current managers, said Leslie Smith, vice president and chief investment officer.
New hires are Pacific Financial Research, large-cap value equity, and Sasco Capital, all-cap active domestic value equity.
Active equity value manager Tweedy, Browne, and international equity managers Brinson Partners and Walter Scott & Partners were awarded global equity portfolios.
The changes were the result of an asset allocation study and portfolio rebalancing, Ms. Smith said. Global equity and all-cap domestic equity are new asset classes.
Portfolio sizes and funding sources were not disclosed. The searches were done in-house.
SEC taps Roye
Paul F. Roye has been named director of the SEC's investment management division. Mr. Roye, who takes over as the nation's top mutual fund cop next month, is the first African-American in the position. Mr. Roye previously was a partner in the Washington office of Dechert Price & Rhoads, and had worked at the SEC from 1979 to 1982. He replaces Barry Barbash, who left the SEC earlier this month.
Timber hires in Ohio
The $44 billion State Teachers' Retirement System of Ohio selected Forest Investment Associates to manage $125 million in southern timber assets and Forest Systems to run $210 million in northwestern timber assets, said Herbert Dyer, executive director.
Hancock Timber was the previous manager. Changes in the forest products industry and capital markets led the pension fund in September to issue eight RFPs, including one to Hancock.
"We are of course disappointed by the decision. We will work closely with the client to assure a smooth transition and we wish them well," said a Hancock spokesman.
Amerada Hess picks 1
The $344 million Amerada Hess pension fund hired Boston Partners to run $30 million in large-cap value stocks, said Kevin Daley, manager of financial planning at the $344 million plan.
Boston Partners replaces INVESCO.
Evaluation Associates assisted.
National Fuel hires BT
The $475 million National Fuel Gas pension fund hired Bankers Trust to actively manage a $30 million international equity portfolio, said Curtis Lee, general manager of finance for the $475 million plan.
BT replaces a terminated manager Mr. Lee declined to name.
The search was done in-house.
Pa. fund makes changes
Trustees of the $23 billion Pennsylvania State Employes' Retirement System approved $185 million in new allocations, said Geoffrey Yuda, information officer.
Berwind Financial Group and PNC Equity Management each will receive up to $25 million to co-invest in a new Pennsylvania capital fund for in-state subordinated debt investment in small business.
In real estate, the system allocated $50 million to Starwood Opportunity Fund V; in private equity, $50 million to Clayton Dubilier & Rice Fund VI and $35 million to ABS Capital Partners III.
Townsend Group assisted on real estate; Cambridge Associates, on private equity. All allocations will be funded from cash.
CalPERS hires Grove Street
The $134 billion California Public Employees' Retirement System hired Grove Street Advisors to implement and run a $350 million venture capital program, said Barry Gonder, senior investment officer.
It is the first time the fund has hired a firm to help it invest in venture capital. "We are giving discretion to Grove to get us increased exposure in the venture capital market, because we believe we are underweighted in that area," Mr. Gonder said.
CalPERS' venture capital investments now account for 9%of its $4.2 billion alternative investment program.
Reinking joins Ibbotson
Richard Reinking joined Ibbotson Associates as vice president of consulting, heading the consulting practice led by Scott Lummer, who left last year. Mr. Reinking previously was an investment consultant at Hewitt Associates. Phil Enochs, an investment consultant, has assumed some of Mr. Reinking's duties, but Hewitt is currently searching for a replacement, said spokeswoman Monica Gallagher.
New record keeper chosen
The $200 million Torchmark defined contribution plans hired Benefits Services as record keeper, moving to daily valuation, said Dennis Luft, manager of employee benefits and payroll.
Record keeping previously was done in-house.
Time Warner fights suit
Time Warner plans to fight a lawsuit filed by the Labor Department charging it misclassified employees as "independent contractors" or temporary workers to avoid providing pension and health-care benefits. The Oct. 26 lawsuit, the first of its kind filed by the Labor Department on this matter, alleges the corporation denied coverage to hundreds of employees. But Time Warner President Richard D. Parsons, in a statement, said the Labor Department's lawsuit has no basis, and the company "will move quickly to dismiss it and expects to be fully vindicated."
The company's statement said its artists, photographers, news stringers and other independent contractors are "truly independent workers."
NYCERS commits to 2
The $37.5 billion New York City Employees' Retirement System invested $1.3 million to develop a domestic violence shelter in Staten Island, and has committed an additional $285,000 to develop permanent housing in Bedford Stuyvesant.
San Antonio picks Seligman
The $1.125 billion San Antonio (Texas) Fire & Police Pension Fund hired J&W Seligman as a large-cap equity manager to run $50 million, said Weir Labatt, executive director.
Seligman replaces another large-cap manager Mr. Labatt wouldn't name.
The search was done in-house.
Hospital plan taps Aeltus
The $320 million Retirement Plan for Hospital Employees hired Aeltus Investment Management to manage $22 million in small-cap equities, said Gus Hontalas, administrator.
Aeltus replaces Nicholas-Applegate, terminated for performance reasons. Rick Shaughnessy, vice president of public relations for Nicholas-Applegate, did not return phone calls by press time.
Watson Wyatt assisted.
Brockton selects 4
The $150 million Brockton (Mass.) Contributory Retirement System chose four new domestic equities managers, said Harold P. Hanna Jr., executive director.
Phoenix Investment Partners will run a small-cap value portfolio; Boston Co., midcap value; Morgan Grenfell Capital, small-cap growth; and Zak Capital, midcap growth, he said.
The system hopes to pick a large-cap growth manager at its Nov. 17 meeting.
Putnam names fund chief
Richard Monaghan will replace Bill Shiebler, who has retired, as the new chief of Putnam Investments' mutual fund division. Mr. Monaghan was previously managing director for Merrill Lynch Asset Management's institutional client division. Merrill Lynch officials were unable to respond by press time about Mr. Monaghan's replacement.
New Zealand deal set
Frank Russell and Australia's ANZ Funds Management have signed a distribution agreement to sell multimanager mutual funds in New Zealand to both institutional and individual investors, the two companies said in a statement.
ANZ will market the funds locally in their branches, and Frank Russell will be a manager of managers. Frank Russell will research, select and monitor manager performance, said Chris Phillips, a Frank Russell spokesman.
The minimum investment in the fund, called the Ascent Investment Program, is New Zealand $25,000 (U.S.$13,068).
LaSalle buys JLW
The purchase of Jones Lang Wootton by LaSalle Partners will not affect pension investors directly because JLW's real estate money manager split off from the parent last year, forming Clarion Partners.
But Stuart L. Scott, chairman and CEO of LaSalle, said LaSalle's pension clients will benefit from JLW's international expertise.
The new company, Jones Lang LaSalle, will have $20 billion in assets under management.
Yacktman proxy mailed
The board of directors of the Yacktman Funds mailed its own proxy statement to shareholders in the family's two funds to counter that mailed by the funds' manager, Donald Yacktman of Yacktman Asset Management.
In a 33-page packet, the directors answer Mr. Yacktman's charges against them and ask shareholders to vote down Mr. Yacktman's proxy to replace them with a group he has selected.
The directors said they do not anticipate that a proxy vote will take place unless Mr. Yacktman is successful in a lawsuit he filed in an attempt to force directors to conduct a shareholder meeting.
Small-manager group forms
An alliance of independent, small investment managers is being formed to help members deal with common issues such as asset and profit growth, client relations, succession and compensation. Qualifying managers should have assets under management between $100 million and $2.5 billion and be located in the northeastern United States. Organizer is consultant Jerry Grimm, owner of F.J. Grimm Associates in Needham, Mass. The group will be informal, collegial and active, Mr. Grimm said.