Local Pensions Partnership, the pool created by Lancashire County Pension Fund and London Pensions Fund Authority, launched a £5 billion ($6.1 billion) global equity fund.
The pool dropped four of Lancashire’s seven external equity managers — Baillie Gifford, Natixis Global Asset Management, Morgan Stanley Investment Management and AGF Investments — in the process, an LPP spokeswoman said. The spokeswoman wasn’t able to disclose how much each firm managed.
LPP combined several existing mandates, reducing managers and bringing 40% of activity in-house, she said. The LPFA previously managed some equities in-house, but it could not be learned how much.
The remaining 60% is now managed by three managers: MFS Investment Management, Robeco Group and Magellan Financial Group. Both pension funds had invested with MFS and LCPF had money with all three managers. Information about how much each is manaRobeco Group Management, Robeco Group and Magellan Financial Group. Both pension funds had invested with MFS and LCPF had money with all three managers. Information about how much each is managing was not disclosed.
It could not be learned by press time whether LPFA dropped any of its managers.
Susan Martin, LPP’s CEO, said in a news release that “the new portfolio provides a significant reduction in overall costs for each of the founding investors whilst also maintaining and improving expected investment outcomes.”
Before the creation of the fund, the total of Lancashire County’s equity assets stood at £2.4 billion, while LPFA’s were £2 billion. The combined size of assets in the pool was £10.3 billion.
In addition, LPP will launch fixed-income, total-return and property funds, the news release said. No time frame for those launches was disclosed.
More illiquid investments, such as private equity, infrastructure and credit, are being consolidated under special-purpose vehicles over the next six months, according to the release.