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UK's Border to Coast launches £5bn alpha fund

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Border to Coast Pensions Partnership, one of the largest UK public sector pension pools in the UK with assets worth approximately £45bn (€52bn), has launched a global equity alpha fund, with assets worth £5bn.

External managers for the fund had already been appointed in June, namely Harris Associates, Investec Asset Management, Lindsell Train and Loomis Sayles,

Boarder to Coast announced that eight out of 12 of the partner funds invested at launch, with assets from 14 mandates across both segregated and pooled vehicles being transferred to the alpha fund.

The restructuring of the assets to the target portfolios of the selected external managers has now been completed with the support of BlackRock and Inalytics as the transition manager and adviser.

This brings the pool’s assets under management to around £15bn, excluding commitments to private markets of £1.8bn that are currently being placed.

The competitive manager selection and economies of scale will result in aggregate annual management fee savings to partner funds of £3.5m per year. The fund seeks to achieve a long-term return 2% pa ahead of the MSCI All Country World Index after deduction of manager fees, a statement disclosed.

Graham Long, head of external investment at Border to Coast, said “The fund aims to combine the highest quality, best value investment managers into a coherent portfolio where the outcome is greater than the sum of the parts.”

Chris Hitchen, chair of Border to Coast, added that this is the pool#s largest fund launch to date. It followed largest and most complex transition to date.

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