UK - The Pension Protection Fund (PPF) is diversifying its investment strategy to include three new portfolios including global tactical asset allocation (GTAA).
In a tender notice, the organisation confirmed it is seeking participants for a framework agreement to establish a panel of global or regional real estate fund managers, a panel of GTAA fund managers and a potential panel of passive managers for various asset classes.
The framework agreement, scheduled to last six years, is designed to allow the PPF "quick access to the marketplace to allow flexibility of investment depending on supplier performance and market conditions".
Fund managers can apply for all three mandates if they have the relevant expertise, although each asset class will have a separate procurement process and will be "evaluated independently of other applications of interest".
The PPF confirmed the passive fund management services contract will cover a broad range of asset classes and "the proposed solution will not be limited to one manager and could potentially conclude with a panel of passive managers in various subset classes".
The contracts will last for an initial period of three years, with the option of a further three-year extension, however the contracts will only be awarded when the "Board of the PPF wishes to allocate funds to a manager".
A PPF spokesperson confirmed the tender is for new mandates, and added: "This is a natural evolution of the strategy: diversifying the growth assets, to source broader growth opportunities at the same time as helping to manage risk."
The PPF issued a tender notice in August 2008 for a £100m global equity portfolio and revealed it planned to appoint a panel of around five managers to act on a call-out basis to avoid the need for re-tendering the contract. (See earlier IPE article: PPF tenders £100m global equity portfolio)
Details from the PPF's latest annual report for 2007/08 showed the organisation had invested assets of £1.47bn (€1.64bn) in March 2008, and invested in a range of assets including UK and global bonds, quantitative UK equity, diversified UK equity, thematic global equity, multi-manager UK property and global currency.
The closing date for tender applications is 8 June 2009 and further information can be obtained from the PPF's procurement department.
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