Michigan Municipal Employees’ Retirement System, Lansing, will gear up its search for one or two managers for a $150 million allocation to active frontier markets equities in the second quarter, said Jeb Burns, MERS’ chief investment officer, in an interview.
Interested managers should contact MERS directly.
Separately, during the first quarter, the $8.7 billion pension fund invested or committed a total of $550 million in three new investment strategies.
Those deals were:
- Napier Park Global Capital received $200 million for investment in a multistrategy credit hedge fund;
- Polunin Capital Partners was hired to manage $200 million in an active small-cap core emerging markets equity strategy; and
- Wood Creek Capital Management received a $150 million commitment to a customized separate account that will invest in real asset opportunities and other diversifying strategies, pending successful contract negotiations.
In addition to the imminent frontier market equity manager search, MERS’ staff has set an ambitious agenda for the rest of the year, Mr. Burns said.
Six to eight managers will be sought as the staff looks to allocate between $800 million and $900 million for the pension fund’s diversifying strategies portfolio.
As part of that process, MERS’ investment officers are close to hiring a long/short emerging markets hedge fund manager and a global macro hedge fund manager, but Mr. Burns said it was too early to identify the firms or the likely allocation sizes.
Other investment ideas being considered from the diversifying portfolio are global tactical asset allocation strategies and real asset investments in Africa and South America, Mr. Burns said.
