Essex fund seeks managers for e1.5bn

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UK – The Essex County Council pension fund is looking for managers for £945m (€1,530m) of its £1.8bn assets, including a passive multi-asset equity and bond mandate worth some £620m and a predominantly UK fixed income mandate worth £140m.

The remainder of the RFP concerns six satellite portfolios comprising three £35m UK equity portfolios, a £40m Japanese equity mandate, a £20m pacific-basin ex-Japan equity portfolio and a £20m emerging markets equity brief.

The RFP is in its first phase and is in the form of a public questionnaire that will run until early May. A selected group will then be invited to tender formally and from there a shortlist of managers will be drawn up and each will be asked to make more detailed presentations. Essex hopes to have the appointments made by the fourth quarter.

The fund’s incumbent manager roster features Legal & General running a passive UK equity portfolio, Merrill Lynch and Baillie Gifford each a multi-asset fixed income and equity portfolio, Capital International a global ex-UK equity mandate, Hendersons a global fixed income brief and Barings the emerging markets portfolio.

In addition, the fund has a property portfolio worth £180m and run by Morley. This is not under review, having been awarded 18 months ago.

John Wigley of Watson Wyatt, the fund’s consultant, says the new asset allocation strategy is the result of an ALM study carried out last year. “The ALM was part of the fund’s ongoing review process and is not a reflection of current manager performance,” he says.

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