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IPE special report May 2018

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Henderson facing axe at Fife Council

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UK – The £950m (€1.4bn) Fife Council Pension Fund has put a roughly £200m global equity mandate out to tender following a review of the scheme’s structure.

The mandate follows a decision to axe the scheme’s only multi-asset manager, Henderson Global Investors, which has been with the scheme for more than 20 years.

“We felt that a multi-asset manager was no longer appropriate for the scheme structure,” said a spokesperson for the Fund.

However, Henderson will be able to apply for the global equity mandate in the open tendering process. Earlier this week, Henderson reported an £8.8bn outflow in institutional assets in 2005.

Henderson’s current brief – which amounts to 35% of the scheme - has approximately 74% invested in equities and a majority of the balance was in bonds. There was also 2% invested in cash.

The fund told IPE that Henderson’s bond portfolio is currently under review. No decisions have yet been taken whether to put it out to tender. The scheme has also decided it will no longer have a strategic cash allocation.

Apart from Henderson, the scheme has four specialist investment managers: BGI has 20% invested in UK equities; Alliance Bernstein holds 25% in global equities; Western Asset Management has 13% in bonds; and ING Real Estate holds 7% in property.

The spokesperson told IPE that the scheme is looking to increase its property allocation to about 10%.

According to the contract notice for the mandate, Hymans Robertson will be advising the scheme on all aspects of the tendering process. The fund is looking to shortlist between five and 12 investment managers.

The mandate will be awarded on the basis of, amongst others, sound financial and economic standing, proven investment ability across a full range of equity markets and a suitable fit with the overall global equity investment programme.

The mandate will not run for a fixed time period, but will be subject to an ongoing review process. The closing date is March 29.

In February, Henderson appointed former Threadneedle Investment client relationship director Jennifer Ockwell as a client director within its expanding European institutional business team.

In January, Henderson was awarded a £120m global enhanced index equity mandate from the Trustees of the Smith & Nephew UK Pension Fund.

Henderson Global Investors has approximately £66.5 billion under management.

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