Iowa Public Employees' Retirement System, Des Moines, issued an RFP in a search for an active, long-only U.S. large-cap growth equity manager to run $600 million to $650 million, according to the RFP.
Iowa PERS, which oversees $24.9 billion, intends to hire one firm. The pension fund plans to benchmark the portfolio to the Russell 1000 Growth index.
Wilshire Associates, the retirement system's investment consultant, is assisting in the search.
Proposals are due May 17. The pension fund's board expects to make a decision in September.
Funding will come from RCM Capital Management, which manages $650 million in active U.S. large-cap growth equity for the pension fund. Iowa PERS plans to terminate RCM for underperformance. Megan Frank, RCM spokeswoman, couldn't be reached for comment.
“IPERS is using BlackRock, one of (its) three transition managers under contract” to transition the assets into a temporary Russell 1000 Growth index fund the firm will manage, Karl Koch, IPERS chief investment officer, said in a statement in response to questions. “Once the search process for RCM's replacement is completed, IPERS will do another transition to create the target portfolio of the newly selected manager.
"Once Iowa PERS hires a new manager, the pension fund plans to ask its transition managers — BlackRock, Russell Investments and State Street — to submit proposals providing a pre-trade analysis estimating trading costs and suggesting trading strategies, Mr. Koch added. “IPERS will then select which (transition manager) to use for the second transition,” Mr. Koch added.
“The mandate is currently anticipated to be approximately $600 (million) to $650 million — whatever the value of the account's assets are when we turn them over to the manager that replaces RCM.”