The trustees of the National Grid U.K. Pension Scheme, London, is looking to sell its in-house money management business, Aerion Fund Management, as it moves to outsource the management of its £17.3 billion ($27.1 billion) of assets.
The decision came following a review of the investment strategy and governance model of the pension fund, said a statement on the pension fund’s website Tuesday.
As of March 31, the pension fund had an allocation of 64% fixed income, 18% equity, 7% each real estate and alternatives, 3% to private equity and 1% cash. Aerion Fund Management runs about 75% of the pension fund’s assets; its real estate, private equity, Asia ex-Japan and emerging markets equity allocations are managed externally. Part of its U.K. and Japanese equity investments, which account for 28% and 14% of the equity allocation, respectively, are also managed by external money managers.
Fenchurch Advisory Partners is advising on the process.
The National Grid U.K. Pension Scheme will also create a small executive team of specialists to support the trustees in the active management of the assets, close monitoring of its liabilities and tight control of investment risks, the statement said.
There is no specific timetable for the process, a spokesman said in an e-mail. “This is the start of the process, and the trustees are keen to ensure the right results for all involved,” including any impact on Aerion staff members, he added.