NOTTINGHAM, England — The decision by Boots Co. PLC's pension fund to abandon its 100% bond allocation is not a shock to U.K. consultants and money managers.
Three years after the £2.84 billion ($5.21 billion) plan boldly abandoned equities, the company last month announced plans to shift 15% of the pension money into other asset classes, including equities. The move was made to better match long-term liabilities, which trustees. thought could be better achieved through other asset classes, said Chris Laud, investor relations analyst at Boots.
Actuarial consultants Hewitt Bacon & Woodrow, London, assisted. Hewitt officials did not return calls by press time.
This isn't a change in strategy; the goal has always been to achieve the best liability match, Mr. Laud added.
He would not provide details on the money managers to be hired or how the 15% will be allocated. He said no decision has been made as to how much money sole manager Legal & General Investment Management, Ltd., London, will continue to run for Boots. He declined to give a timeframe for the change.
Consultants and money managers were not surprised by Boots' decision.