LGIM wins E394m Highland Council mandate

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UK – The Scottish Highland Council pension fund has moved 272 million pounds (394.6 million euros) formerly managed by Rothschild Asset Management to Legal & General Investment Management following the acquisition of Rothschild AM by HBOS’s fund management arm, Insight Investment Management.

The 405 million pound (587.5 million euro) fund has been undergoing an extensive review. Hymans Robertson was re-appointed as actuarial consultant about 18 months ago, Northern Trust was appointed global custodian last summer, and the investment management portion has been under review since.

The scheme was originally divided into two balanced mandates, with Rothschild managing 272 million pounds, and Baillie Gifford managing 133 million pounds. During the review process, however, Rothschild announced its sale to Insight, and the transfer of the funds to the new company.

Says Brian Williams, head of capital accounting at the council: “The council decided that they would rather choose which manager is running the mandate, rather than the manager choosing for them.”

Rothschild’s portfolio has now been transferred to Legal and General Investment Management following a competitive pitch. L&G will run the 272 million pound portfolio only until the investment management review process is finalised. The mandate will be run on a passive basis.

By December, Williams expects the fund to be split into two global equity mandates, a specialist bond mandate and a specialist property mandate. 20% of the fund will be retained by L&G on a passive basis, and Baillie Gifford will be retained to run one of the global equity mandates.

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