Oregon Public Employees Retirement Fund, Salem, will search for a manager to run $500 million in active domestic large-cap value equities, and up to two controlled risk domestic equity managers to handle a total of $500 million to $750 million. Officials for the $33.1 billion pension fund expect to hire the value manager by year-end, said Mike Mueller, interim director of investments. Consultant Frank Russell will handle the searches.
Funding for the active large-cap manager would come from reducing a $4 billion passive Russell 1000 Value index fund run by Barclays Global Investors, Mr. Mueller said. Funding for the risk manager allocation will come from BGIs passive $3.9 billion Russell 1000 growth portfolio and its Russell 1000 value fund, he said. BGI also runs $770 million for the fund in an alpha-tilt strategy.
Separately, the fund terminated Peachtree Asset Management, which ran $178 million in active domestic equities benchmarked to the Russell 1000 index, because of performance. Those assets also will be used to fund one of the controlled-risk strategies.
The system also placed Alliance Capital Management on watch for a $425 million active domestic large-cap portfolio because of concerns that portfolio manager Al Harrison may be distracted by ongoing Enron Corp. events, Mr. Mueller said. Becker Capital Management, which runs a $239 million active domestic small-cap value equities portfolio for the fund, also was put on watch because of long-term performance concerns, Mr. Mueller said.
Officials at Peachtree, Alliance and Becker did not return calls requesting comment by press time.