Illinois Teachers sets $632 million for 8 managers, hires 5 transition managers

Updated with correction

Illinois Teachers' Retirement System, Springfield, allocated $632 million to eight managers, spokesman Dave Urbanek said.

On behalf of its $7.8 billion global fixed-income portfolio, the $43.8 billion pension fund committed $100 million to LCM Credit Opportunities Fund III, managed by LCM Partners, and hired Pemberton Capital Advisors to manage $50 million. Funding will come from rebalancing across the pension fund portfolio.

In private equity, the pension fund allocated up to roughly $482 million to six managers:

  • $200 million to RCP Advisors for a separate account;
  • €75 million ($85 million) to EQT for a European middle-market fund;
  • up to $65 million to Sofinnova Venture Partners X, managed by Sofinnova Ventures;
  • €50 million to Astorg VI, managed by Astorg Partners;
  • $50 million to Grain Management's Communications Opportunity Fund, on behalf of its emerging managers program; and
  • $25 million to Shasta Ventures Fund V.

The pension fund has previously invested with EQT and Sofinnova funds.

Separately, the pension fund hired three new transition managers — Macquarie Group, Northern Trust and Penserra Securities — and rehired Citibank and Loop Capital. A search for transition managers was launched last year due to a policy that services go out to bid every three years and because two of the six transition managers approved in 2012 — Credit Suisse Asset Management and J.P. Morgan Asset Management (JPM) — closed their transition businesses in 2013. Mr. Urbanek declined to provide information on whether the other incumbents — State Street Global Markets and Russell Investments — rebid.

Also, the pension fund added TCW Group to its watchlist for performance on an emerging markets debt strategy. The pension fund has $582 million currently invested in the strategy.

A TCW spokesman declined to comment.