NETHERLANDS - The Dutch pension fund of South Africa-based paper maker Sappi has awarded a 16.25 million-euro inflation-linked bond mandate to Legal & General Investment Management.

"Legal & General responded quickly to our requirement for a passive index-linked bond fund with long duration,” said Stichting Pensioenfonds Sappi Netherlands spokesman Bert Stassen. “We also found the conditions of this fund attractive."

LGIM said the brief is an investment in its new ‘Eurozone Over 5 year Inflation Linked Index Fund’. It added the fund aims to meet demand from European pension funds who “want an investment fund which delivers a real yield based on the euro zone inflation rate to enable them to closely match their liabilities”.

"Naturally we are delighted to have been awarded this mandate,” said Tim Breedon, LGIM’s director of investments.

“It is particularly pleasing that our ability to develop funds that closely match clients' requirements has provided the right solution for Stichting Pensioenfonds Sappi Netherlands.”

The fund was advised by Mercer Investment Consulting. Sappi began life as South African Pulp and Paper Industries in 1936.

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