CalSTRS mulls asset shift
CalSTRS staff favors shifting the asset mix of its $350 million private equity program that invests in urban and rural assets in California. Three potential asset mixes will be presented at the investment committee meeting Oct. 2, and staff favors a mix of 50% in funds of funds and 50% in a combination of corporate partnerships, co-investment funds, and middle-market and venture capital funds, said Sherry Reser, spokeswoman for the $93 billion fund.
The staff's original recommendation had favored a 65%-35% split between funds of funds and direct investments. The fund will not issue RFPs.
BlackRock buys Cyllenius
BlackRock will buy Cyllenius Capital Management, a $100 million all-cap growth equity hedge fund, said Ray Ahn, BlackRock spokesman. Terms were not disclosed. This is BlackRock's first foray into the domestic equity hedge fund market, Mr. Ahn said. The company already runs several fixed-income hedge funds, which are closed to new investors. The Cyllenius hedge funds will retain their names.
UAL plans get a credit
UAL, parent of United Airlines, is applying $190 million of its credit balance toward its four U.S. pension plans, which have a combined $7.5 billion in assets, confirmed Clifford T. Hew, director of pension investments. The pension plans have $10.1 billion in obligations, he said.
UAL's pension contributions have exceeded the federal minimum funding requirement over the past several years, according to the company's website; pension law allows plan sponsors that contribute more than the required amount to use that surplus as a credit to reduce future payments. UAL will use the credit to meet the minimum funding level, reserving the company's cash for liquidity purposes.
U.K investments jump
U.K. institutional investors made L22.7 billion ($35.1 billion) in new investments in the second quarter, with most going to defensive securities rather than stocks, a report from Britain's Office for National Statistics shows. That was a L13.7 billion increase from the second quarter of 2001.
Pension plans, money managers and insurance companies cut their investments in overseas equities by almost half in the second quarter, while investments in U.K. gilts increased almost threefold, according to the report.
Wisconsin exec quits
Mary E. Willett, director of supplemental retirement plans for the State of Wisconsin, and president of the National Association of Government Defined Contribution Administrators, resigned effective Nov. 12. She will start a consulting firm and work as an independent consultant for public defined contribution plans with Nationwide Financial.
SSR exits bundled business
Executives at State Street Research say it will take at least the rest of the year to move $302 million in 200 bundled 401(k) and supplemental income plans to other record keepers. The company decided to exit the fully bundled business two weeks ago.
Kansas keeps custodian
The $9.1 billion Kansas Public Employees' Retirement System renewed its contract with master custodian Mellon Trust for an additional five years, said Scott Peppard, CIO. The fund conducts contract reviews every five years, he said.
The $167 million El Paso County (Colo.) Pension System renewed its consulting contract with Summit Strategies for three years. The fund had issued an RFP for a full-service consultant in July but found "no compelling reason to make a change," said Dave Klemmer, plan administrator. He said the board did not interview other finalists and decided that "given the market volatility, we wanted to keep some continuity."
Evergreen buys firm
Evergreen Investments acquired J.L. Kaplan Associates, an asset management firm that runs $3 billion for institutional and high-net-worth clients. The all-cash purchase price was not disclosed.
Bill Ennis, Evergreen president and CEO, said the acquisition of the value-oriented boutique plugs a gap in its institutional capabilities. James Kaplan, J.L. Kaplan founder and owner, and his colleagues will remain with the firm, which will operate independently and retain its name.
Police OK Russell
The $25 million Boynton Beach (Fla.) Police Pension Fund hired Frank Russell to manage $16 million in a pooled fund invested 60% in equity and 40% in fixed income, said Barbara B. LaDue, administrator. Funding came from terminating INVESCO, which ran the money in a balanced portfolio with the same split. Salomon Smith Barney advised.
Arrangement suits funds
Over 80% of multinational companies say preferred provider arrangements for active investment managers added value in the management of their global pension plans, according to a survey by Watson Wyatt Investment Consulting.
Under the arrangements, multinational pension plans agree on a list of firms viewed as most suitable to provide services such as investment management and consulting.
STERIS picks Principal
STERIS Corp. hired Principal Financial as bundled provider for its $140 million 401(k) plan, said Robert W. Becker, employee benefits director. KeyCorp, its previous provider, has left the bundled defined contribution business. Hartland assisted.
Union switches managers
The $80 million Plumbers & Steamfitters Local 630 in West Palm Beach, Fla., hired Richmond Capital to manage $10 million in active domestic core fixed income, said Owen L. Culpepper, business manager and chairman. Funding came from terminating Strong Capital. Investment Performance Services advised.
Mill hires NYLife
Malden Mills Industries hired NYLIM Retirement Plan Services to manage its $15 million defined benefit plan for union members, replacing SSgA.