With a potential closing date as early as Oct. 15 for the deals, plan executives contacted for this story said they have less than two months to issue RFPs for their investment consulting mandates because of Summit's departure from the public defined benefit plan business — a limited time frame to issue searches, conduct due diligence and make a selection.
"Yes, the sale does present a problem, since another (consultant) cannot be sought out and hired in such a short time frame," said Jeffrey Yates, retirement administrator at the $1.1 billion Baton Rouge (La.) and Parish of East Baton Rouge Employees' Retirement System.
Amy Baskerville, spokeswoman for the $2.7 billion Baltimore City Fire & Police Employees' Retirement System, agreed the short time period before Summit is no longer its investment consultant is a problem. She said plan officials would not elaborate.
Another plan executive, who asked not to be identified, said that the short timespan is difficult for many smaller-size pensions funds that make up the bulk of Summit's public defined benefit plan clientele because they rely heavily on their investment consultant to make decisions on allocation and manager selection. "It's a big decision for us," the plan executive said.
Orlando, Fla.-based AndCo Consulting would take on Summit's public DB consulting business, which comprised about 20% of its overall $160 billion in assets under advisement as of Dec. 31, while Mercer is acquiring Summit's defined contribution consulting and outsourced CIO business. AndCo had $77.3 billion in AUA as of June 30, 2017.
The Baltimore City Fire & Police plan is already conducting an invitation-only search for a replacement to Summit, and the $819 million St. Louis Employees' Retirement System has issued an investment consultant RFP, due Oct. 15. AndCo will be considered for both assignments and, in the case of St. Louis, said Rich Olliges, accounting officer, will serve as interim consultant until a permanent selection is made.
Also, the $600 million Knoxville (Tenn.) City Employees' Pension Fund announced it would issue a consultant RFP in mid-September, as will the $710 million St. Louis County Retirement Plan, Clayton, Mo.
The $8 billion Missouri State Employees' Retirement System, Jefferson City, will decide at a Sept. 13 board meeting whether to issue an RFP to replace Summit as its investment staff consultant.
But spokeswoman Candy Smith said the system's policy and best practices would presume an RFP would be issued.