Wales Pension Partnership, a pool of eight local government pension scheme funds in Wales, hired Russell Investments to provide investment management and advisory services, and appointed Link Asset Services to establish and run a collective investment vehicle.
A news release by the £15 billion ($20.3 billion) asset pool said the appointment of Link, which will establish and run a tax-efficient U.K. collective investment vehicle known as an Authorized Contractual Scheme — or ACS — is a key milestone in the pooling process, added the release.
The ACS will have subfunds in a range of asset classes to enable them to invest according to their different asset allocation strategies. Supported by Russell and in consultation with the eight individual LGPS funds, Link will appoint a number of money managers. Each LGPS fund will retain control over strategic asset allocation decisions, added the release.
A separate news release by Link and Russell said the money manager will assist in establishing investment vehicles, advising Link and the Wales Pension Partnership on efficiencies around portfolio construction, including manager selection for the pool of assets excluding passive equity. Link and Russell will also work to further reduce costs, where applicable, through a multimanager structure, currency management, portfolio overlays, transition management and other execution services. The two firms worked together during the procurement process, which was run by WPP and its advisers, Hymans Robertson and Burges Salmon.
The Wales Pension Partnership comprises the Cardiff and Vale of Glamorgan Pension Fund, Cardiff; City and County of Swansea Pension Fund; Clwyd Pension Fund, Mold; Dyfed Pension Fund, Carmarthenshire; Greater Gwent (Torfaen) Pension Scheme, Pontypool; Gwynedd Pension Fund, Caernarfon; Powys County Council Pension Fund; and Rhondda Cynon Taf Pension Fund, Tonypandy.
An executive at Carmarthenshire County Council, the host authority for the partnership, referred questions to the partnership's news release.