Arkansas Public Employees Retirement System, Little Rock, hired LSV Asset Management as a domestic small-cap equity manager, said Carlos Borromeo, chief investment officer for the $7.6 billion pension fund, in an email.
The final allocation is still being determined but is estimated around $200 million.
Funding will come from Lombardia Capital Partners, which was terminated as a domestic small-cap value equity manager in February because of performance. The firm shut its doors in the spring due to "a confluence of events," including the March move of the firm's international value equity team to American Century Investments and poor performance of the flagship small-cap value equity strategy, co-CEO Vincent Williams previously told Pensions & Investments.
The assets from Lombardia (roughly $200 million) were temporarily with Mellon Capital Management in a small-cap value equity index fund.
Investment consultant Callan Associates assisted with the search for Lombardia's replacement.
Rob Kozlowski contributed to this story.