ChevronTexaco Corp.'s proposed $16.4 billion acquisition of Unocal Corp., announced today, would give the combined business $9.7 billion in 401(k) plan assets and $6.1 billion in defined benefit assets. Both funds have little overlap in their money manager lineups, suggesting a revamp down the road should the acquisition be approved by regulators and shareholders.
ChevronTexaco's $5.2 billion defined benefit plan and Unocal's $910 million defined benefit plan have similar equity exposures, with 47% to 50% in U.S. equities and 16% to 20% in international stocks, according to data from Pensions & Investments and the 2005 Money Market Directory. But ChevronTexaco has only 20% in U.S. fixed income, compared with 36% for Unocal; ChevronTexaco has 8% of assets invested in real estate equity, while Unocal had nothing invested in alternatives. The two pension funds each use Dodge & Cox and TCW Group for U.S. equities, but differ on other accounts.
On the defined contribution side, San Ramon, Calif.-based ChevronTexaco had 60% of its $9.2 billion 401(k) plan invested in company stock, while El Segundo, Calif.-based Unocal had 40% of its $489 million 401(k) plan in company stock. Both 401(k) plans use Vanguard Group for several investment options, but otherwise differ in their manager choices. ChevronTexaco uses Vanguard entities as master trustee and record keeper, while Unocal uses Putnam Investments/Mercer HR Outsourcing as its record keeper.
Bill Clutter, manager-accounting & analytics for ChevronTexaco, said he didn't know any details at this time. Eugene Prochnow Jr., Unocal's manager-benefit plan investments, declined to comment.
