The $320 million pension fund of Stanley Works, New Britain, Conn., completed an asset allocation study that resulted in a number of changes, said Craig Douglas, director-corporate finance. The fund raised its international equity allocation to 25% from 15%, decreased U.S. equities to 55% from 62% and lowered its real estate target to 10% from 13%. U.S. bonds remain at 8%; cash, 2%.
The fund's non-U.S.assets had been passively managed by BZW Barclays. Because the fund wanted a lower cost provider, it shifted its non-U.S. indexed exposure - 12% of the fund - to Bankers Trust. Also hired were Capital International for a new $16 million emerging markets allocation and J.P. Morgan for a new $25 million Japan portfolio.
The fund also parceled out $18 million each to: Lazard Freres for U.S. small-cap value; Bankers Trust, U.S. small-cap growth; Iridian, midcap value; and William Blair, midcap growth. Funding came from a reduction in passively managed U.S. equities and from two unnamed U.S. large-cap managers that were terminated.
No real estate managers were terminated.