Florida plan may sue Alliance
Florida State Board of Administration officials are considering legal action against Alliance Capital Management, which bought 4.9 million shares of Enron between August and November as a large-cap manager (now terminated) for Florida. Fund officials are investigating whether Alliance acted improperly by continuing to buy stock in Enron after indications of Enron's financial problems started to emerge, said Lee Baldwin, spokeswoman for the fund.
Gen'l Dynamics shifts funds
General Dynamics shifted about $1.3 billion of its $5.8 billion in pension plan assets into various domestic equity asset styles from domestic fixed income. The assets are being shifted to existing managers, said Joseph Gallagher, vice president of Fiduciary Asset Management, which is the plan's main fiduciary and consultant and hires all its managers. The change was the result of an asset allocation study.
UNC does debt deals
University of North Carolina at Chapel Hill committed $32 million to distressed debt funds and $10 million to MetWest Asset Management for a high-yield fund, said CIO Mark Yusko. For distressed debt, the $1 billion endowment committed $10 million each to Oaktree Capital Management and Credit Suisse First Boston Private Equity; $7 million to Contrarian Capital Management; and $5 million to Lend Lease. Funding came from rebalancing. The enhanced fixed-income portfolio, which includes high-yield and distressed bonds, was raised to 11% of assets from 5%, Mr. Yusko said. Domestic equities were cut to 15% of total assets from 20%, and international equities to 12% from 15%.
Schroder kept on watch
The $6.6 billion Los Angeles City Employees' Retirement System is keeping Schroder on watch until June 30, said CIO Dan Gallagher. Schroder manages a $132 million emerging markets portfolio for the fund. Separately, the system extended Capital Guardian's contract for another three years. Cap Guardian runs a $240 million active European core equity portfolio benchmarked to the MSCI Europe index.
Oregon extends contracts
Oregon Investment Council, which oversees investments of the $36.2 billion Oregon Public Employees Retirement Fund, extended the contracts of consultants Frank Russell and Pension Consulting Alliance until Dec. 31, 2003, said Michael Mueller, assistant director-investments.
Also, the system converted a $16 million core fixed-income portfolio run by Commonfund into a core-plus portfolio. The portfolio is part of the state's $56 million Higher Education Endowment.
Arkansas Police & Fire hires
The Arkansas Local Police & Fire Retirement System hired three active international equity managers - INVESCO and KBC Asset Management to run $10 million each, and Fisher to manage $5 million , said Larry Middleton, senior vice president of consultant Stevens Inc. The $450 million pension plan partially funded the portfolios by terminating Thomson, Siegel & Walmsley, which managed $15 million in active international equities;.
Washington eyes private equity
Washington State Investment Board's private equity committee recommended the system commit $600 million to existing private equity partners this year and $300 million to new relationships, invest $900 million in private equities this year, said CIO Gary Bruebaker.
The full board will vote on the recommendation this month. Washington State's $41.2 billion commingled trust has a 17% target allocation to private equities.
The board renewed State Street Bank's three-year contract as custodian. The system also plans to search in May for securities lending services for its $13 billion in fixed-income assets and $3 billion in international equities. SSB handles securities lending for the fund.
More realty for Chicago Muni?
Chicago Municipal Employees' Annuity & Benefit Fund may invest $50 million in real estate. The $5.7 billion plan issued RFIs but is not conducting a formal search, said Terrance Stefanski, executive director. Last year, it decided to raise its real estate target to 5% of total assets, from 2%.
Deutsche Bank reorganized its asset management divisions, pending its purchase of Zurich Scudder Investments. Richard Goldman continues as head of institutional at Deutsche's U.S. private client and asset management business. Victor Heinz, his counterpart at Zurich Scudder, will head client service and will report to Mr. Goldman.
Mark Cassady, head of Zurich Scudder's Americas region, will take over the combined U.S. mutual fund families. Deutsche Americas mutual fund boss Ross Youngman will work on special projects.
Berger acquires INTECH
Berger Investments acquired INTECH, an institutional money manager with $6 billion in assets under management, from Prudential Financial. Terms were not disclosed. Key INTECH employees will hold a minority stake in the firm.
Europe a boon for custodians
Europe will be a major growth market for global custodians in this decade, according to a new study by Celent Communications. Growth will be driven by a projected increase in European-based pension assets of e5 trillion, largely because of pension privatization efforts on the Continent, according to Celent. Pan-European custodians such as HSBC, BNP Paribas and Deutsche Bank are well-positioned to capture a significant amount of the new assets, the study said.
Wisconsin combines portfolios
Wisconsin State Investment Board merged its $1 billion Opportunity E high-risk portfolio with its $1.2 billion private equity portfolio, said Vicki Hearing, spokeswoman for the $55 billion fund. Jim Gannon, investment director for private equity, was named managing director of the $2.2 billion portfolio. It is a new position.
Mike Wagner, manager of the Opportunity E portfolio, will remain with the system in a role that has yet to be determined.
Kevin Carter to Watson Wyatt
Kevin Carter was named a senior partner at Watson Wyatt in England. Mr. Carter quit as CEO of Old Mutual Asset Managers last month.