Clwyd Pension Fund has joined Cornwall’s local authority scheme in appointing Man FRM as its hedge fund manager, replacing four existing managers.

The £1.4bn (€2bn) Welsh fund, administered by Flintshire County Council, said Man’s managed account solution granted it the transparency not always available in other fund-of-fund arrangements.

The mandate follows Cornwall Pension Fund’s appointment of Man in January, and will see both mandates pooled.

The hedge fund manager has implemented a system for local government pension schemes (LGPS) that will see fees reduced across the collective local authority mandate as more funds opt to join Cornwall and Clwyd.

JLT Employee Benefits, which oversaw the tender process for Clwyd, said the arrangement offered by Man was “compelling”.

Kieran Harkin, director at JLT, added: “In the context of the current LGPS environment, the collaboration between Clwyd and Cornwall should be seen as an example of what can be achieved by funds working together in a proactive way.”

As a result if Man’s appointment, Clwyd severed ties with its former hedge fund managers Lionsgate, SSARIS, Bluecrest and Duet.

The mandate, which also encompasses managed futures, is set to be worth 9% of the fund’s assets, an estimated £120m.

Cornwall in January allocated £120m to Man, meaning Clwyd’s allocation effectively doubled the size of LGPS mandates.

In other news, LCP has been hired to advise the Rebus Insurance Services Limited Pension Scheme.

The final salary fund is currently implementing a revised investment strategy, with LCP’s assistance.

LCP’s advice will cover both short and long-term strategies. 

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