Arkansas Teacher Retirement System, Little Rock, terminated Wellington Management's $400 million active opportunistic global equity strategy, said George Hopkins, executive director.
The termination was not because of performance. Executives at the $12.25 billion pension fund and its consultant, Hewitt EnnisKnupp, had concerns it would be difficult in the coming years for Wellington to replicate its past success, Mr. Hopkins said in a telephone interview.
The assets will be transferred to existing global equity index funds managed by BlackRock and State Street Global Advisors. SSgA currently manages about $1 billion in its fund for the Arkansas Teacher system; BlackRock, $750 million.
Separately, the pension fund made a $60 million direct investment in Big River Steel for a 20% stake in a new steel mill that is being built in northeast Arkansas, Mr. Hopkins said.
The pension fund has previously partnered with funds or managers in apartment buildings and golf courses, but Mr. Hopkins said to his knowledge, this is the first direct investment.
