A Scandinavian investor has tendered out a $400m (€355m) US equities mandate via IPE Quest.

According to search QN-2571, the investor is only interested in the mandate being run as a segregated account – the strategy should not be offered as a UCITS product, it said.

It has specified that the style should be “value, large or all-cap”, and that an active or fundamental process should be applied.

The benchmark should be either the Russell 3000V or the Russell 1000V, with the investor expecting a tracking error of at least 3% but no more than 6%.

Managers should have at least $5bn in assets under management as a firm, and at least $1bn in US equities. Their track record should be at least three years, but a minimum of five years is preferred.

The deadline for applications is 14 November at 5pm UK time. Applicants should state performance data to 31 October 2019, gross of fees.

The IPE news team is unable to answer any further questions about IPE Quest, Discovery, or Innovation tender notices to protect the interests of clients conducting the search. To obtain information directly from IPE Quest, please contact Jayna Vishram on +44 (0) 20 3465 9330 or email jayna.vishram@ipe-quest.com.

ERAFP retenders convertible bond mandates

ERAFP, France’s €29.6bn additional pension fund for civil servants, has three convertible bond mandates to award afresh as existing ones expire next year.

The pension fund is looking to award two active mandates for around €700m in total, and one stand-by mandate.

According to ERAFP, the objective for the mandate winners will be “to develop an active, non-benchmarked management of a portfolio of international convertible bonds and to outperform the benchmark index”.

They are being asked to ensure that the composition of the international convertible bond portfolio complies with the pension fund’s socially responsible investment framework.

ERAFP’s convertible bond portfolio was put in place in 2012 and has been run by Schelcher Prince Gestion and Lombard Odier Gestion. As at 31 December the portfolio amounted to €671m at amortised cost, representing 2.6% of ERAFP’s total assets.

German federal state seeks small and mid-cap manager

The finance ministry for the German federal state of Saxony-Anhalt is looking to invest in European small and mid-caps in a bid to increase risk diversification and expected yields.

According to a tender notice (in German), it is looking to appoint one asset manager to invest around €90m, with the strategy to form one segment of a German “Spezial AIF”. The ministry said the mandate was for the federal state’s pension fund (€1.2bn as at the end of August), its fund for the sanitation of contaminated sites, endowment assets, and other assets. 

Italy’s Arco hires Payden & Rygel 

Arco, the Italian pension fund for workers employed in the wood, furniture, forestry, brick and concrete sectors, has appointed Payden & Rygel Investment Management, to manage a €140m balanced equity and fixed income mandate.

The mandate will be run by the asset manager’s multi-asset strategies team.

The pension fund detailed planned changes to its strategic asset allocation for its balanced prudent and balanced dynamic sub-funds earlier this year. In an April newsletter, Arco said the changes were being made in light of the changed context of financial markets, and “in order to allow financial managers to seize greater market opportunities”. 

To improve returns on the balanced prudent and balanced dynamic sub-funds, bonds would be diversified over shorter maturities, with managers directed to follow “global aggregate” indices – which include government bonds and corporate bonds – rather than investment-grade and high-yield bonds specifically – also for emerging markets.

In addition, a new 15% strategic allocation was to be created for illiquid alternative investments including private debt, real estate and infrastructure equity, it said.

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