Elsevier turns to specialists
NETHERLANDS - Stichting Pensioenfonds Elsevier-ondernemingen has contracted two asset managers for its fixed income portfolio, focusing on liability driven investment.
Moves to change the fixed income portfolio managers follows the advice of a committee on investment policy which recommended it look at using specialist active asset managers.
While details of the companies appointed have not been revealed, Han van ‘t Veer, director of investment at the Elsevier pension fund, made clear to IPE the appointment of two assets managers for the equity portfolio is still pending.
The €524m scheme said it wants asset managers to be complementary to each other, by each managing half of the portfolio in their asset classes, according to the company's annual report.
The pension fund has recently contracted out its investment administration to Kasbank, Van ‘t Veer added.
At the same time, changes are being made to asset allocation of the fund as excellent returns on property - 47.3% in 2006 - have persuaded Elsevier's pension fund officials to increase its investment in property from 4% to approximately 10% of the total asset allocation.
This means the Elsevier scheme will decrease its equity portfolio from 54% to 49.5% in 2007, whilst extending its spread over Europe, North America, Japan, Pacific and emerging markets, it said. Equities returned 18.7% in 2006.
The scheme's fixed income portfolio - 42% of its assets - showed a negative yield of 0.7% but the pension fund has decided to invest its first quarter €20m contributions in long bonds, stated the firm's results.
In addition, the scheme will begin investing in commodities, starting at first by placing up to 5% of its assets, albeit the speed and build up will depend on actual market developments, Van ‘t Veer indicated.
The pension fund reported a total return on investments of 10.9%. Its funding ratio rose to 132.1%, which allows for a full indexation.
Elsevier's pension fund has 2,960 active participants, 3,225 deferred members and 960 pensioners.