Mandate roundup: Barking & Dagenham, Scottish Borders, LGT, ERAFP
UK - The local authority fund for Barking & Dagenham is looking to establish a framework agreement with as many as five managers for a global equity mandate covering a quarter of its portfolio.
The £584m (€744m) local government pension scheme said the mandate would range in size between £75m and £150m.
Only managers overseeing an unconstrained, long-only global equity strategy with more than £200m in assets have been asked to apply.
The pension fund said the four-year period of the framework agreement could see a single manager take control, or several mandates awarded either concurrently or in succession, with asset managers expected to deliver a “substantial” outperformance of the MSCI World index.
The local authority stressed that agreeing a framework agreement did not guarantee a mandate award would take place.
Interested parties have until 16 August to contact Hymans Robertson’s London office for further information.
According to its most recent annual report from March 2011, the LGPS has asset management agreements with AllianceBernstein, Goldman Sachs Asset Management, Aberdeen Asset Management, RREEF and Schroders Property Indirect Real Estate fund.
It also invests in M&G’s UK Companies Financing fund.
Of those, AllianceBernstein was responsible for a global and UK equities portfolio worth 30% of assets under management, with Goldman in charge of 34% of assets deployed in an overseas equity strategy.
In other news, the local authority fund for the Scottish Borders council has appointed managers to two mandates worth a combined £79m.
The search, launched in late 2010, sought to appoint managers to a high-alpha global equities portfolio, as well as a company to oversee its alternative investments portfolio, worth £46m and £33m, respectively.
LGT Capital Partners has emerged as the successful bidder among six applicants, winning the seven-year contract from the council.
Lastly, French public sector fund ERAFP is tendering a framework agreement for a multi-asset vehicle, set to be funded with as much as €100m.
The €12bn scheme for the supplementary public sector pension said the manager would implement a “diversified, flexible, dynamic and opportunistic” asset allocation, managing the assets as a French general purpose fund (FCP).
“The manager will adopt a fundamental approach, without any benchmark constraint, to build a portfolio based on a rigorous asset allocation and fund selection process in compliance with ERAFP’s [socially responsible investment] guidelines,” the mandate added.
The scheme added that the four-year contract could be renewed for two additional two-year periods, with ERAFP expecting the €100m to be invested within three years of the initial award.
The framework would encompass as many as three managers, with one selected to oversee the funds.
ERAFP is one of Europe’s largest SRI investors, with its entire portfolio invested in accordance to its responsible investment charter.
Earlier in the year, it tendered several mandates, covering European and global convertible bonds, as well as property both in France and the continent.