Searches and Hires

Phoenix City Employees gives Driehaus $19 million for international small-cap equity

Phoenix City Employees' Retirement System hired Driehaus Capital Management to run about $19 million in active international small-cap equities, Greg Fitchet, investment officer, said in an email.

The $2.6 billion pension fund began a shortlist search in October following the approval of 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%.

The other finalists were Acadian Asset Management and Mondrian Investment Partners.

It is the final step in the pension fund's restructuring of the portfolio. In November, the pension fund had 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 Investment Partners 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.

Investment consultant Meketa Investment Group assisted.