Skip to main content
MENU
Subscribe
  • Login
  • My Account
  • Logout
  • Register For Free
  • Subscribe
  • Topics
    • Alternatives
    • Artificial Intelligence
    • CIOs
    • Consultants
    • Defined Contribution
    • ESG
    • Face to Face
    • Hedge Funds
    • Industry Voices
    • Investing
    • Money Management
    • Partner Content
    • Private Credit
    • Pension Funds
    • Private Equity
    • Real Estate
    • Regulation
    • Special Reports
    • Washington
    • White Papers
  • International
    • U.K.
    • Canada
    • Europe
    • Asia
    • Australia - New Zealand
    • Middle East
    • Latin America
    • Africa
  • Rankings & Awards
    • 1,000 Largest Retirement Plans
    • Top-Performing Managers
    • Largest Money Managers
    • DC Money Managers
    • DC Record Keepers
    • Largest Hedge Fund Managers
    • World's Largest Retirement Funds
    • Best Places to Work in Money Management
    • Excellence & Innovation Awards
    • WPS Innovation Awards
    • Influential Women in Institutional Investing 2024
    • Eddy Awards
  • Resource Guides
    • Active Thematic Global Equities
    • Retirement Income
    • Fixed Income
    • Pension Risk Transfer
    • Pooled Employer Plans (PEPs)
  • ETFs
    • Latest ETF News
    • Fund Screener
    • Education Center
    • Equities
    • Fixed Income
    • Commodities
    • Actively Managed
    • Alternatives
    • ESG Rated
  • ESG
    • Latest ESG News
    • The Institutional Investor’s Guide to ESG Investing
    • ESG Sustainability - Gaining Momentum
    • ESG Investing | Industry Brief
    • Innovation in ESG Investing
    • ESG Rated ETFs
    • Divestment Database
  • Defined Contribution
    • Latest DC News
    • The Plan Sponsor's Guide to Retirement Income
    • DC Money Manager Rankings
    • DC Record Keeper Rankings
    • Innovations in DC
    • DC Plan Design: Improving Participant Outcomes
  • Searches & Hires
    • Latest Searches & Hires News
    • Searches & Hires Database
    • RFPs
  • Research Center
    • The P&I Research Center
    • Earnings Tracker
    • Endowment Returns Tracker
    • Corporate Pension Contribution Tracker
    • Pension Fund Returns Tracker
    • Pension Risk Transfer Database
  • Careers
  • Events
    • View All Conferences
    • View All Webinars
  • Print
Breadcrumb
  1. Home
  2. SEARCHES AND HIRES
October 27, 2017 01:00 AM

Illinois Teachers preps emerging markets debt search, allocates $1.3 billion

Pension funds also terminates 7 managers running $2.4 billion

Christine Williamson
  • Tweet
  • Share
  • Share
  • Email
  • More
    Reprints Print

    The $49.4 billion Illinois Teachers' Retirement System, Springfield, authorized a search for an active emerging markets debt manager to run between $300 million and $600 million at a board meeting Friday.

    The search, which is scheduled to be posted in about two weeks, is being conducted because the fund hasn't reviewed managers in the asset class for three years and several newer, non-U.S.-based managers have come to the attention of investment staff, said Scottie Bevill, senior investment officer for fixed income, during an investment committee meeting on Thursday.

    Funding for the mandate will come from reducing existing emerging markets managers' portfolio. The successful manager, who may manage the account in local or hard currency, likely will be selected in the first quarter of 2018, Mr. Bevill said.

    The current emerging market debt managers are Franklin Templeton Investments and TCW Group, which manage $584 million and $580 million, respectively.

    Also, the pension fund allocated more than $1.3 billion to six managers. The largest allocation was hiring Arrowstreet Capital to manage $500 million in active quantitatively managed international equity. Funding will come from the termination of a $501 million active large-cap growth international equity portfolio managed by McKinley Capital Management for performance reasons, said Bill Thomas, investment officer for global equity.

    McKinley Capital executives did not return a call for comment by press time.

    The pension fund established an up to $250 million strategic partnership for venture capital with Greenspring Associates' existing commingled vehicles — a fund of funds, secondaries fund and co-investment fund.

    Up to $600 million was earmarked as part of the strategic partnership for a fund of one to which the fund's existing venture capital funds, which total $674 million, will be moved as part of "laying the future for our venture capital program," Joshua M. Ross, investment officer for private equity, said at the investment committee meeting.

    About $350 million of existing venture capital investments will ultimately be maintained, with the balance to be invested in new venture capital funds, co-investments and to acquire secondary stakes based on the advice of Greenspring Associates.

    Mr. Ross said TRS needs to "become more creative" because of extreme capacity constraints in the venture capital industry.

    "The hope is that we will be able to get into the best venture capital managers' funds with Greenspring's help. They are the best in the space. As a public pension fund, we need a partner like this," Mr. Ross aid.

    Man Group was hired to manage up to $300 million in an alternative risk premium strategy. As part of the restructuring of the $3.1 billion hedge fund portfolio, which began after the fund's August meeting, trustees approved the termination of Bridgewater Associates' Pure Alpha directional hedge fund strategy, which totaled $336 million, and of Tourbillon Global Venture's global long/short equity strategy, which held $195 million.

    Edward Shim, investment officer for hedge funds, said neither strategy was "a good fit" within the new portfolio structure and stressed that each manager could be replaced with hedge funds or alternative risk premium strategies with lower fees and greater transparency.

    Bridgewater continues to manage $921 million in risk-parity strategies for TRS.

    Solar Capital Partners received a $125 million commitment, of which $75 million will go into the firm's closed-end middle-market direct lending fund, and $50 million to a separate account of individual loans. It also committed up to $50 million to Basis Investment Group Fund I, a U.S. real estate debt securities fund. The commitment is from the system's $515 million emerging managers program.

    Trustees also committed up to $100 million to Clearlake Capital Partners V, which invests in underperforming or financially stressed middle-market North American companies in the technology, consumer and industrials sectors. TRS invested in the three prior three Clearlake Capital Group funds.

    Separately, as part of a portfolio construction change in the pension fund's $4.8 billion beta-plus fixed-income portfolio to a more defensive position with shorter bond duration, three managers were terminated: Manulife Asset Management for a $477 million core-plus bond strategy; New Century Advisors, $383 million global-inflation-linked bond fund; and PGIM Fixed Income, $308 million U.S. relative-value bond strategy. PGIM will continue to manage $811 million in other fixed-income strategies for TRS.

    Redeemed assets will be redistributed among the nine remaining managers in the portfolio, Mr. Bevill said.

    Garcia Hamilton & Associates also was terminated for management of a $182 million floating rate short-term asset reserve fund because staff determined only one manager was needed to manage the $1.3 billion account. Taplin, Canida & Habacht, the other manager, will absorb the additional assets, Mr. Bevill said.

    TRS trustees ratified the termination by staff between meetings of Acadian Asset Management for management of a $563 million active U.S. large-cap core portfolio. Mr. Thomas said Acadian was terminated because it is more non-U.S.-focused than the portfolio requires. Staff may look at other similar managers, he added.

    Acadian continues to manage $882 million in an active large-cap core international equity portfolio.

    Related Articles
    Illinois Teachers targets $525 million for 5 managers
    Illinois Teachers sets 2018 pacing schedule, restructures diversifying strategi…
    Illinois Teachers preps real estate co-investment consultant search
    Houston Firefighters allocates $110 million to emerging markets debt, private e…
    Ircantec looking for 2 managers to run €800 million in quantitative equity
    Illinois Teachers trustees OK search for private debt consultant
    Illinois Teachers seeks first real estate co-investment consultant
    Illinois Teachers looking for general, hedge fund investment consultants
    Illinois Teachers assigns $224 million to 2 managers, terminates Mondrian
    Recommended for You
    Bola Olusanya
    MacArthur Foundation picks new CIO from The Nature Conservancy
    Protest in Pakistan
    India-Pakistan tensions short-lived, but investors worry conflict may expand
    Grace Reyes, left, Stephen Gilmore and Scott Chan sit on a panel at the Catalyst forum.
    CalPERS, CalSTRS CIOs discuss portfolio resiliency amid market uncertainty, DEI pushback
    Sponsored
    White Papers
    The State of Lifetime Income Report
    The Next Wave of LDI Evolution
    Retirement security to future income wins, TIAA brings you the latest financial…
    U.S. Public Funds Top Performers: Q2 2024
    Generative AI Investing: Opportunities at a Key Tech Inflection Point
    Research for Institutional Money Management: Advancing Physical Risk Modelling,…
    View More
    Sponsored Content
    Partner Content
    The Industrialization of ESG Investment
    For institutional investors, ETFs can make meeting liquidity needs easier
    Gold: the most effective commodity investment
    2021 Investment Outlook | Investing Beyond the Pandemic: A Reset for Portfolios
    Ten ways retirement plan professionals add value to plan sponsors
    Gold: an efficient hedge
    View More
    E-MAIL NEWSLETTERS

    Sign up and get the best of News delivered straight to your email inbox, free of charge. Choose your news – we will deliver.

    Subscribe Today
    October 23, 2023 page one

    Get access to the news, research and analysis of events affecting the retirement and institutional money management businesses from a worldwide network of reporters and editors.

    Subscribe
    Connect With Us
    • RSS
    • Twitter
    • Facebook
    • LinkedIn

    Our Mission

    To consistently deliver news, research and analysis to the executives who manage the flow of funds in the institutional investment market.

    About Us

    Main Office
    685 Third Avenue
    Tenth Floor
    New York, NY 10017-4036

    Chicago Office
    130 E. Randolph St.
    Suite 3200
    Chicago, IL 60601

    Contact Us

    Careers at Crain

    About Pensions & Investments

     

    Advertising
    • Media Kit
    • P&I Custom Content
    • P&I Careers | Post a Job
    • Reprints & Permissions
    Resources
    • Subscribe
    • Newsletters
    • FAQ
    • P&I Research Center
    • Site map
    • Staff Directory
    Legal
    • Privacy Policy
    • Terms and Conditions
    • Privacy Request
    Pensions & Investments
    Copyright © 1996-2025. Crain Communications, Inc. All Rights Reserved.
    • Topics
      • Alternatives
      • Artificial Intelligence
      • CIOs
      • Consultants
      • Defined Contribution
      • ESG
      • Face to Face
      • Hedge Funds
      • Industry Voices
      • Investing
      • Money Management
      • Partner Content
      • Private Credit
      • Pension Funds
      • Private Equity
      • Real Estate
      • Regulation
      • Special Reports
      • Washington
      • White Papers
    • International
      • U.K.
      • Canada
      • Europe
      • Asia
      • Australia - New Zealand
      • Middle East
      • Latin America
      • Africa
    • Rankings & Awards
      • 1,000 Largest Retirement Plans
      • Top-Performing Managers
      • Largest Money Managers
      • DC Money Managers
      • DC Record Keepers
      • Largest Hedge Fund Managers
      • World's Largest Retirement Funds
      • Best Places to Work in Money Management
      • Excellence & Innovation Awards
      • WPS Innovation Awards
      • Influential Women in Institutional Investing 2024
      • Eddy Awards
    • Resource Guides
      • Active Thematic Global Equities
      • Retirement Income
      • Fixed Income
      • Pension Risk Transfer
      • Pooled Employer Plans (PEPs)
    • ETFs
      • Latest ETF News
      • Fund Screener
      • Education Center
      • Equities
      • Fixed Income
      • Commodities
      • Actively Managed
      • Alternatives
      • ESG Rated
    • ESG
      • Latest ESG News
      • The Institutional Investor’s Guide to ESG Investing
      • ESG Sustainability - Gaining Momentum
      • ESG Investing | Industry Brief
      • Innovation in ESG Investing
      • ESG Rated ETFs
      • Divestment Database
    • Defined Contribution
      • Latest DC News
      • The Plan Sponsor's Guide to Retirement Income
      • DC Money Manager Rankings
      • DC Record Keeper Rankings
      • Innovations in DC
      • DC Plan Design: Improving Participant Outcomes
    • Searches & Hires
      • Latest Searches & Hires News
      • Searches & Hires Database
      • RFPs
    • Research Center
      • The P&I Research Center
      • Earnings Tracker
      • Endowment Returns Tracker
      • Corporate Pension Contribution Tracker
      • Pension Fund Returns Tracker
      • Pension Risk Transfer Database
    • Careers
    • Events
      • View All Conferences
      • View All Webinars
    • Print