DII Industries LLC Asbestos PI Trust, Greenville, Texas, hired consultant Cambridge Associates to advise trustees on setting investment policy issues. Halliburton Co. funded the new trust - created to settle asbestos claims stemming from subsidiaries of the Houston-based firm - with some 11% of Halliburton's stock. Cambridge will advise on the timing of the sale of the 59.5 million shares, valued at $2.6 billion, according to trust officials. Cambridge will also advise on asset allocation and money management structure and selection.
A shareholder agreement between Halliburton and the asbestos trust restricts the timing of the sale of the Halliburton shares. Ultimately, "the trust could sell all 59.5 million shares in around a year, depending on our weekly trading volume," said Beverly Scippa, Halliburton public relations manager. The shares' $2.6 billion value is based on the $43.74 closing price of Halliburton stock March 2.
The trust agreement permits investments under the prudent-investor standard and allows investments in alternatives. The trust hasn't initiated any search for money managers because it is still developing investment policy plans, said Marcellene Malouf, the trust's executive director.
Alan R. Kahn, managing trustee for the trust, said he doesn't know how soon the plan for the investment program will be finished or how soon the trust will sell any of the Halliburton stock.