UK - Shropshire County Council is seeking a fund manager to run a second global bond portfolio for its £750m (€890m) pension fund.

The local government pension fund has a global aggregate bond portfolio managed by PIMCO, which will remain unchanged.

However a spokesman for Shropshire County Council revealed it had recently reviewed the pension fund's allocation to bonds and had decided to switch its existing allocation to UK aggregate bonds to a global bond portfolio, as there appears to be "more opportunities in global bonds than in the UK".

The pension fund will still have a UK index-linked bond mandate run by Legal & General Investment Managers, however the UK aggregate portfolio now managed by Aberdeen Fund Management will be reallocated, albeit Aberdeen will be allowed to submit a tender for the new global mandate.

A tender notice issued by Shropshire County Council revealed it is looking to appoint one or more managers, either on a segregated or a pooled basis, although the value of the entire portfolio is estimated at £57m.

The starting date for the mandate is expected to be 1 May 2009, and the successful manager will be expected to meet "client specific performance objectives" within the portfolio.

Figures from the pension fund's annual report for 2007/08 showed the asset allocation of the fund is 25% in fixed income and 75% in equities, property and hedge funds, which also includes a 3% allocation to private equity.

The report also revealed the last significant change in the pension fund's investment strategy occurred in 2007 when Shropshire reviewed its property investments and the Pensions Committee "felt that the UK commercial property market was at the peak of the cycle and that it was an opportune time to diversify into the European property market".

At that time, the fund tendered for a European property manager, including the UK, and appointed Goodman Property Investors to manage the portfolio in May 2007, and it sold a "significant proportion of its UK property assets prior to the rapid deterioration of the UK commercial property market in late 2007. At the end of the year 57% of the funds property investments were in continental Europe".

Closing date for submissions to the global bond tender is 6 January 2009 and more information can be obtained from Shropshire County Council.

If you have any comments you would like to add to this or any other story, contact Nyree Stewart on + 44 (0)20 7261 4618 or email nyree.stewart@ipe.com

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