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Pension Funds

Phoenix City Employees narrows equity search to 3 finalists

Phoenix City Employees' Retirement System named Acadian Asset Management, Driehaus Capital Management and Mondrian Investment Partners as finalists in its shortlist search for an active international small-cap equity manager to run $25 million, said Greg Fitchet, investment officer, in an email.

The $2.6 billion pension fund's board will conduct finalist interviews at its April 4 meeting, after which it will make a selection. The pension fund conducted shortlist searches for three international equity managers after the board approved on Oct. 4 a restructuring of its international developed markets equities portfolio. The restructuring was the result of a March 2017 asset allocation overhaul that included reducing the international developed markets equity target to 9% from 16% and the creation of an emerging markets equity target of 8%.

In November, the pension fund hired Northern Trust Asset Management to run about $77 million in passive international equities following the terminations of Grantham, Mayo, van Otterloo & Co. from a $114 million active value equity portfolio, State Street Global Advisors from a $79 million passive low-volatility equity portfolio and Mondrian from its $71 million active small-cap equity portfolio. Baillie Gifford, which ran a $199 million active growth equity portfolio, was reduced to $77 million and the pension fund shifted the allocation to Baillie Gifford's EAFE Pure Focus strategy from its ACWI ex-U.S. Alpha strategy.

The pension fund in February hired First Eagle Investment Management to run about $70 million in active international value equities.

Investment consultant Meketa Investment Group assists with all manager searches.