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West Midlands tenders €581m in equities

UK - The £4.7bn (€6.83bn) West Midlands Metropolitan Authorities scheme is tendering four equity mandates, worth a total of at least £400m (€581.7m).

A spokeswoman told IPE that the fund tendering a global equity brief worth about £100m and three enhanced-indexation mandates each worth between £100m and £150m.

The enhanced mandates must be invested in the UK, European and North American areas, the spokeswoman said.

The scheme, whose resources are managed by internal and external managers, was worth as of end of March 2004 £4.7bn, but the spokeswoman said its current value was likely to be over £5bn.

According to its 2003/2003 Investment report, as of March 2004 the value of the schemes’ UK equities portfolio amounted to £2.08bn, while overseas equities were worth £1.5bn. The UK fixed income portfolio amounted to £648m, the property portfolio to £349m and cash to £115m.

Among its 2004/2005 targets, the fund aims to match ”the five- and ten-year investment returns of pension funds, which are likely to be in order of 7.5%”. The fund, which has also tendered a corporate governance voting partners mandate, also aims at expanding its proxy voting activities in the US and cast its vote at over 900 general meetings.

The scheme has stated on its web-site that it is 96% funded and it intends to bridge the gap by “a combination of modest increased employer contribution rates and reduced benefits for contributors in the future e.g. reduced pensions for early retirees and a later normal retirement date”.

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