Arkansas Teacher Retirement System, Little Rock, terminated Pacific Investment Management Co., which managed about $475 million in its Total Return strategy for the pension fund, said George Hopkins, executive director.
Mr. Hopkins said the decision to terminate PIMCO was twofold. Officials at the pension had been looking to derisk the fund's fixed-income portfolio, and the September departure of William H. Gross, PIMCO's co-founder and chief investment officer, contributed to the decision to move out of the strategy completely.
“[Mr. Gross'] departure came at an inopportune time,” Mr. Hopkins said.
The assets will be transferred to a fixed-income index fund managed by State Street Global Advisors. State Street currently manages about $250 million in the index fund, Mr. Hopkins said.
The $14.2 billion pension fund has a 20% target allocation to fixed income.
Separately, the pension fund committed $25 million to Siris Partners III, a buyout fund managed by Siris Capital Group.
It is a first-time commitment to Siris.
The pension fund has a 10% target allocation to private equity.