Month: September 2020

  • AlpInvest takes over management of life science funds of funds

    first_imgAlpInvest – formerly owned by the large Dutch asset managers APG and PGGM – is Carlyle’s private equity branch and among the world’s largest private equity investors.Carlyle manages €132bn of alternative investments worldwide.Last week, AlpInvest announced that its Secondaries Program (ASP) reached more than €3bn, including its secondaries fund V (ASF V), which closed at its hard cap of more than €548m – 50% over its target.According to AlpInvest, ASP includes commitments from not only APG and PGGM but also 18 other institutional investors.The private equity investor said it had issued €6.6bn of commitments through 84 transactions over the past 11 years.A 22-strong team in Amsterdam, New York and Hong Kong are managing the company’s investment. The €35bn private equity investor AlpInvest Partners and alternatives asset manager Carlyle Group have assumed the management of two life science funds of funds in Indiana.They said their combined assets in the Indiana Future Fund (IFF) and its successor, the Inext Program (INext), amounted to €95m.The IFF was established in 2003 to invest in venture capital funds looking to invest in life sciences in Indiana.AlpInvest and Carlyle already have an office in Indianapolis, where a two-strong team of investment professionals manage €223m on behalf of the state pension fund INPRS, aimed at direct investments, co-investments and fund commitments in the state.last_img read more

  • Unigestion targets Canadian institutional investors with new office

    first_imgUnigestion has opened a new office in Toronto to increase its institutional business in Canada.The Swiss asset manager already has two institutional mandates in the country – the pension plan of the Desjardins group, which awarded a mandate in 2012, and an unnamed institutional client that mandated Unigestion in 2013.For both institutions, Unigestion is running global equity mandates with a combined value of CAD500m (€330m).Through its new office in Toronto, it will also be offering its other products, including “risk-managed equities, private assets, alternative investments and cross asset solutions”, a spokesman confirmed to IPE. Heather Cooke has been named director institutional clients for the new office.She joins from Mercer Canada, where, since 2010, she was partner and leader of Implemented Consulting and Dynamic De-Risking.The Swiss asset manager said its services were “ideally suited” to the institutional investor segment in Canada, where pension funds, endowments and foundations are keen to diversify their manager pool and are open to new solutions.Unigestion said the Canadian pension fund market had been growing every year for the last 10 years, and that the company aimed to “go where the clients are”.“The opening of the Toronto office is a major development in the expansion of Unigestion’s footprint beyond its traditional European markets,” the Swiss asset manager said.In total, Unigestion has €10.9bn in assets under management, with more than half in segregated mandates.last_img read more

  • IORP II risk-evaluation rules must be drafted before directive can pass – AEIP

    first_imgIt further warned that the article within IORP II detailing the REP made allowances for a delegated act should be abandoned in favour of the legislative draft containing all relevant information, due to the “sensitivity” of the topic.Delegated acts are often inserted after a Directive has been passed by the European Parliament and would likely be informed by the European Insurance and Occupational Pensions Authority’s work, similar to the devolution of responsibilities on regulations for other financial directives to the European Securities and Markets Authority.“Moreover, the future draft delegated acts should be subject to a cost-benefit analysis and should be limited to technical aspects,” the position paper added.“All the information and improvements the Risk Evaluation for Pensions might bring to an IORP could be reached also through [asset-liability management] studies.”The REP currently stipulates that funds examine risks stemming from a number of areas, including the risk to its portfolio from climate change and resource scarcity.The AEIP was also strongly in favour of the IORP Directive being scrutinised not only from a financial perspective, calling for greater involvement for those responsible for social affairs within the European Commission and Parliament.It further called for the directive to be discussed not only by the finance ministers of each member state as part of an Economic and Financial Affairs (ECOFIN) meeting, but for representatives of domestic social affairs ministries to debate it during their own meetings.The organisation suggested the Pension Benefit Statement (PBS), widely criticised by a number of other groups, failed to add additional value, and said the proposed two-page format was unlikely to provide “clarity and understanding”.“The AEIP would rather plead to [allow] for national creativity and national solutions to information provision adapted to the specific needs of the different IORPs,” it said.“It would refrain from providing just more information, as this should rather be clearer and comprehensible.” The European Commission must publish further details of the proposed IORP II risk assessment framework ahead of the Directive passing into law, according to the European Association of Paritarian Institutions (AEIP).Publishing its position paper on the revised IORP Directive, the organisation was critical of the draft’s “overwhelming internal market point of view” and argued that the directorate general and parliamentary committee for employment and social affairs should be more closely involved in all future decisions.However, the AEIP welcomed the Directive’s removal of member state investment restrictions and its abandoning capital requirements, which internal markets commissioner Michel Barnier confirmed last year would be dropped.It nevertheless warned that the proposed Risk Evaluation for Pensions (REP), to be completed “regularly and without delay” when a change in a scheme’s risk profile occurs, could be seen as the “first step” towards an Own Risk and Solvency Assessment (ORSA) – one of the key elements of Solvency II.last_img read more

  • PFA takes over Danish pension fund for pharmacists

    first_imgHe said the fund had had a “very positive dialogue with PFA” and was confident customers’ savings would be safe with the company.The pension fund has been looking into the possibility of moving members’ plans to another, larger company since 2013, PFA said.“As Denmark’s smallest pension fund, in the long run, we cannot live up to our members’ natural expectations of their pension provider,” said Larsen Gulev. “It is to our customers’ clear advantage to move the scheme to PFA.”He stressed that the pension fund had in no way been forced into a marriage of convenience with PFA, but that the requirements from authorities as a pension fund grows made it difficult for small institutions to deliver a competitive product.PFA said the new pension customers would come under one umbrella within the organisation as its existing customers in the pharmaceutical field: professional association Pharmadanmark, the Danish Pharmaceutical Association and Pharmakon – the Danish College of Pharmacy Practice. Denmark’s Pensionskassen for Apotekere og Farmaceuter, the pension fund for pharmacists, has been taken over by the country’s biggest commercial provider PFA, with the professional fund’s DKK1.5bn (€201m) of pension savings being transferred.As part of the shift, which took effect on 1 April having been agreed at the pension fund’s general meeting in December, all members’ plans will change to unit-linked savings products from traditional with-profits plans.The move includes around 2,000 scheme members and annual contributions of about DKK65m.Jesper Gulev Larsen, chairman of the pharmacists’ pension fund, said: “We have, after careful consideration, chosen PFA as future pension provider for our members.”last_img read more

  • Dutch pension funds’ ‘search for yield’ cancels out cost-cutting efforts

    first_imgDutch pension funds managed to cut asset management costs in 2014 by 0.3 percentage points to approximately 0.60% of total assets, according to survey by LCP Netherlands in co-operation with the Dutch Pensions Federation.LCP, which looked at the annual reports of more than 240 schemes, found that actual asset management costs fell from 0.54% to 0.52% over the same period, while transaction costs dropped from 0.09% to 0.08%.Jeroen Koopmans, a partner at LCP, said cost-cutting had been “limited” and questioned why pension funds, particularly the larger ones, had failed to exploit the benefits of scale, as combined assets under management increased by €115bn last year.In recent years, many Dutch pension funds have striven to cut costs by streamlining their investment processes,  increasing their focus on passive management or abandoning relatively expensive assets classes such as hedge funds. Anne Laning, chair of the Dutch Pensions Federation’s reporting committee, attributed the slowdown in cost-cutting to pension funds’ ongoing “search for yield”.“Pension funds have increased their investments in asset classes such as infrastructure, mortgages, credit, direct loans and emerging market equities, which require more work and are therefore more expensive,” he said.Laning, who is also CFO at TKP Investments, said the trend towards sustainable investment could also increase costs.“If an asset manager must attend all shareholder meetings to monitor sustainability, costs are inevitable,” he added.According to the survey, pensions administration costs remained at €122 per participant on average. The researchers said that, for the third consecutive year, they could not find a correlation between costs and total returns. Koopmans suggested that additional cost benefits could be achieved through intensified negotiations – possibly through co-operation with other pension funds – as well as scrutinising contracts.last_img read more

  • Denmark asks pension funds for traffic-infrastructure financing proposals

    first_imgSo far, none of the pension funds invited has submitted a proposal to the ministry.The idea of building a motorway ring road that would connect motorways north and south of Copenhagen, involving an undersea tunnel, has been under discussion for more than seven years.The harbour tunnel (havnetunnelen) proposal – also known as the Eastern Ring Road or Østlig Ringvej proposal – has been seen as a way of relieving inner-city congestion and improving air quality for the city’s inhabitants. A 2013 analysis by the ministry estimated the cost of building the underground road system could be DKK15bn (€2bn), and that user tolls could bring in around DKK3.5bn a year.In a recent interview in the Danish publication Ingeniøren (The Engineer), Schmidt said: “If anyone wants to build a Copenhagen tunnel and says they will pay in exchange for the money earned from drivers going through it, they are very welcome to do that.”Schmidt said in the interview he had asked the pension funds to submit proposals for road and rail projects, although he acknowledged the harbour tunnel was uppermost in his mind.The first step is to finance a feasibility study into the building of the tunnel, he said, which is part of the government’s programme.But this work cannot begin without the involvement of the municipality of the city of Copenhagen, as well as companies developing the harbour island of Refshaleøen and the Nordhavn area (north harbour), he said.Schmidt stressed that, in contrast to the 18km Femern Tunnel project linking Denmark and Germany, the traffic investments now in question would not be guaranteed by the state.Private investors would be the ones shouldering the risk in return for receiving income from motorists, rail companies or passengers, he said. Danish pension funds have been invited to work on financing proposals for traffic infrastructure projects in the country by the Ministry of Transport and Building (Transport- og Bygningsministeriet), including the ambitious Copenhagen harbour tunnel plan.The minister for transport and building Hans Christian Schmidt met representatives of several Danish pension funds a few months ago, a spokeswoman for the ministry confirmed.“He has asked pension funds to come up with proposals for financing new infrastructure projects,” she said, adding that the meeting had been an informal one in which Schmidt told the institutional investors they could send propositions to the ministry.Although no specific projects have been laid on the table, the spokeswoman said it was possible one of the pension funds could be interested in finding a way to invest in the suggested harbour tunnel idea.last_img read more

  • Joseph Mariathasan: Europe’s pharmaceutical and biotech industries

    first_imgAre Europe’s large pharma companies thematically too diversified? Are there opportunities to invest in smaller companies emulating the US market? The fact 85-90% of one of Europe’s largest healthcare funds is invested in the US suggests Europe faces some significant long-term challenges if it wishes to retain its pre-eminence in healthcare. The manager prefers small and mid-sized companies as new investment ideas that have a clear world-class expertise and a focus on specific areas, which he holds for upwards of five years. He sees Europe’s large pharma companies as solid, good companies but argues that they are thematically too diversified, or even run as healthcare conglomerates.Europe does not see the plethora of small and mid-sized spinoffs and start-ups that are seen in the US, but the US is not its only rival. China and India have well-established pharmaceutical industries, and, with an abundance of brainpower, they are well positioned to produce streams of cutting-edge healthcare companies.Europe’s healthcare industry can be divided into three segments, with a handful of giants – the UK’s GSK, the British-Swedish AstraZeneca, the Swiss Novartis and Roche, France’s Sanofi, Danish diabetes specialist Novo Nordisk and possibly the German company Fresenius. Beneath the pharma giants is a set of mid-sized companies that, for historical reasons, are owned by foundations or families, such as the Danish company Lundbeck, the French company Ipsen, the Spanish companies Rovi and Almirall and the Italian company Recordati. Beneath this are hundreds of emerging biotech companies – some very tiny and others of reasonable size. But the biotech industry is very much weighted towards the US, versus Europe. There are many reasons for this, including the availability of risk capital.Pharma is still perceived as being a safer-haven, low-volatility sector. Over the long term, it would generate lower returns than biotech but outperform the broader market. Biotech is still perceived as an innovation industry that is more volatile. But the US companies such as Celgene are producing double-digit revenue growth rates with very high sustainable profit margins. For Europe as a whole though, the issue may not be purely one of generating short-term investment returns. If the jewel in its crown is not to be tarnished over the long term, Europe’s pharmaceutical sector must find a way to emulate the success of the biotech companies in the US.Joseph Mariathasan is a contributing editor at IPE Europe’s pharmaceutical sector must find a way to emulate US biotech, Joseph Mariathasan writesThe European pharmaceutical industry is arguably the jewel in the crown of Europe’s industrial base, and GlaxoSmithKline (GSK) is one of the UK’s giants. It showed its strength last week when it filed its shingles vaccine Shingrix for US regulatory approval. Analysts estimate that the drug, one of GSK’s most promising experimental products, could generate revenues of $1bn (€909m) a year.But Europe faces some significant long-term challenges if it wishes to retain its pre-eminence in healthcare. GSK may be an example of what could be the problem – it needs to revitalise a drug portfolio characterised by reliance on a few blockbusters now seeing falling sales, such as its inhaled lung treatment Advair. The US patent on this expired in 2010, so it is only a matter of time before generic versions destroy its revenues.PwC estimates that almost half of all corporate research and development in the in UK in 2016 has been accounted for by the healthcare and pharmaceutical industry. Clearly, the sector has immense strengths, but the problem is that virtually all of that figure is accounted for by just two companies – GSK and AstraZeneca. Europe has not seen the plethora of small and mid-sized spinoffs and start-ups that characterise the US healthcare market.last_img read more

  • Dutch pensions sector to draw up ESG covenant

    first_imgCurrently, almost every Dutch scheme has an ESG policy based on the sector’s code for pension funds and the Pensions Act. The latter requires schemes to report on how they take the environment, climate, human rights, and social relations into account.In practice, however, every pension fund lays the emphasis in a different way, depending on industry, sponsor, or occupation of its participants.The Pensions Federation said it would seek a covenant “matching the sector’s diversity and offering added value to the pension funds and society”.It added that it wanted to use the OECD’s directive for multinational companies, as well as the UN’s Principles for Responsible Investment and “guiding principles” for companies and human rights for its ESG agreement.The €382bn civil service scheme ABP said that pension funds could benefit from each other’s experience and added that joint definitions and standards would help them operating more efficiently.ABP, however, emphasised that agreements must be clear, measurable, and feasible.Meanwhile, a separate study by GRESB and consultant Finance Ideas has suggested that only the largest pension funds, such as ABP and the €185bn healthcare fund PFZW, deploy all available tools for ESG policy.The study, which examined 171 pension funds, found that only the largest schemes took part in impact investing and had set reduction targets for carbon emissions.“Small funds have insufficient staff to implement ESG,” said Piet Eichholz, professor of finance at Maastricht University, who guided the survey. “Moreover, they are often passive investors.”In his opinion, increased co-operation could enable smaller pension funds to increase their potential for ESG policy.The researchers also concluded that the richer a pension fund is, the more attention it pays to social and responsible investment.Eichholz said they did not find a difference in ESG approach between the large sector schemes and company pension funds.GRESB – which leads ESG efforts in the real assets space – and Finance Ideas looked at nine different ESG criteria, ranging from impact investment to full exclusion.According to Eichholz, all pension funds had excluded companies from investment, such as manufacturers of cluster munitions.Six out of 10 schemes reported extensively about their ESG efforts, with half of the surveyed pension funds using engagement and voting during annual general meetings. The Dutch Pensions Federation plans to draw up an environmental, social, and governance (ESG) covenant for pension funds, which would also involve government and societal organisations.The agreement, for “international corporate social responsibility” (IMVO), is aimed at improving co-ordination and the exchange of expertise between pension funds, which should result in shared definitions and standards, according to the federation.A spokesman said that 70 pension funds – representing 84% of Dutch schemes’ assets – had already signed the declaration of intent for the covenant.The federation indicated that it was still assessing which organisations it would approach for the agreement.last_img read more

  • UK leader promises M&A veto for Pensions Regulator

    first_imgUK prime minister Theresa May has promised to give the country’s Pensions Regulator (TPR) the power to veto mergers or acquisitions if they threaten the solvency of a connected pension scheme.In a press release on the ruling Conservative Party’s website, the party said that “any company pursuing a merger or acquisition valued over a certain amount or with over a certain number of members in the pension scheme would have to notify the Pensions Regulator, who could then apply certain conditions”.“In short we will tighten the rules on pensions during takeovers, and increase punishments for those caught mismanaging schemes,” the statement said.May recently called a general election for 8 June this year, and the UK’s political parties have already begun their respective campaigns. Today’s statement reflected proposals from the Work and Pensions Committee – an influential cross-party group of politicians from the UK’s lower house – published at the end of last year, following feedback from TPR.Pensions minister Richard Harrington subsequently addressed the idea of expanding TPR’s powers as part of a consultation on reform of the defined benefit system.The regulator’s powers were called into question last year during its investigation of the BHS pension scheme. The UK high street chain was sold in 2015 for £1 by the Arcadia group, owned by Sir Philip Green, while the scheme was left with a shortfall of more than £500m (€592m). Sir Philip subsequently struck a deal with TPR to contribute up to £363m to the restructuring effort for the pension scheme.The Conservative Party’s statement said: “In recent years, the employees of large, household-name companies have found their pensions put at risk by the irresponsible behaviour of their bosses. But responsible companies managing their pension scheme in the right way have found their competitive position suffer from that same behaviour.”The party added: “In cases where there is no credible plan in place and no willingness to ensure the solvency of the scheme, the Pensions Regulator could be given new powers to block a takeover. This would include the power to issue punitive fines for those found to have willfully left a scheme under-resourced.“If fines proved insufficient, the company directors in question could be struck off for a period of time and a new offence could be introduced to make it a criminal act for a company board to intentionally or recklessly put at risk the ability of a pension scheme to meet its obligations.”last_img read more

  • People moves: APG appoints former Norges Bank chief to board [updated]

    first_imgAPG – The €475bn Dutch asset manager APG has appointed financial heavyweight Knut Kjær (pictured, left) as a member of its supervisory board (RvC). Kjær was the founding chief executive of Norges Bank Investment Management, responsible for Norway’s sovereign wealth fund and the management of most of the country’s foreign reserves.In recognition of his contributions to the management of the Government Pension Fund, he was knighted by King Harald of Norway in 2008. APG, Mercer, PMT, Bouwinvest, BNP Paribas Asset Management, Hoogovens, Loomis Sayles, BMO Global Asset Management, Fidante Partners, eVestment, IFM Investors Since 2011, Kjær has been chairman and partner at FSN Capital Partners, a Nordic private equity firm, chairing its asset management branch since 2017. He also holds advisory positions at China Investment Corporation and the Monetary Authority of Singapore. Between 2008 and 2016, Kjær was a member of the investment committee of the €409bn Dutch civil service scheme ABP, APG’s main client.APG’s RvC also includes Maes van Lanschot (chairman), Bart Le Blanc (vice chair).Mercer – The investment consulting giant has hired Jo Holden as UK chief investment officer. Based in Liverpool, she has also joined the firm’s UK defined benefit (DB) leadership team. She has worked at Mercer since 2002 and set up its Manchester office in 2010 as well as expanding the firm’s UK public sector consulting team.David Fogarty, head of Mercer’s UK DB business, said: “Jo has extensive knowledge of the investment consulting space, and great energy and enthusiasm for developing our proposition further to meet the needs of our clients.”Holden replaces Steven Blackie, who was announced as head of global product strategy at Aviva Investors last week.PMT – The €70bn Dutch sector scheme for metalworking and mechanical engineering has appointed Gerard Roest and Ron Follon as trustees. Roest will be tasked with socially responsible investment. He was nominated by trade union FNV and succeeds Albert Akkerman, who died last September.Currently, Roest is board member of the general pension fund of Unilever and is a policy adviser at the FNV. He was previously chairman of BPL, the industry-wide pension fund for agriculture, and has been trustee at the former sector schemes for the wholesale of flowers and plants (Bloemen en Planten) and the paint and printing ink industry (Verf en Drukinkt), as well as the FNV’s own pension fund.Follon was nominated by employer organisation FWT and will become a member of PMT’s pensions committee. He is general secretary at the FWT and the organisation’s lead negotiator for collective labour agreements in the sector. Follon succeeds Hep van Luunen, who has been a PMT trustee for 16 years.Janus Henderson Investors – Georgina Fogo has been appointed chief risk officer at the £274bn (€315bn) asset management group. She will join in July from BlackRock where she is global head of compliance, and succeeds David Kowalski who retired last year. She has worked for BlackRock since 2009, and previously built the compliance teams for Barclays Global Investors – now iShares –in Europe and the US.In a statement, Janus Henderson co-CEOs Dick Weil and Andrew Formica said: “With the regulatory landscape for asset managers and clients becoming increasingly complex, her experience will be invaluable in ensuring Janus Henderson remains at the forefront of the change agenda and risk management best practice.”Bouwinvest – The €8.5bn property investor for the large Dutch pension fund for the building industry (BpfBouw) has appointed Barbara Sleijffers and Frans van Burk to the acquisition team of its retail fund. It said the new team members would assist the fund increasing its assets from €900m to €1.1bn by 2020.Sleijffers joins from Sweco Capital Consultants, where she provided pension funds with strategic and tactical advice on property. Prior to this, she worked at engineering firm DHV Royal Haskoning and insurer ASR. Van Burk is to become commercial assistant for acquisitions and joins from CBRE Global Investors, where he was senior commercial analyst. He has also worked at ING REIM.BNP Paribas Asset Management – Julien Halfon has joined the firm as head of pension solutions within its multi-asset, quantitative and solutions investment group.  (‘MAQS’). He is responsible for providing advice and designing bespoke strategies for pension funds and insurance companies. Halfon was previously a senior consultant at Mercer, and has also held senior positions at P-Solve, Lazard, Hewitt Bacon & Woodrow, and Goldman Sachs.Hoogovens – André van Vliet has joined the board of the €8.5bn pension fund Hoogovens, representing the scheme’s pensioners. Van Vliet will focus on institutional asset management and becomes a member of the pension fund’s balance and investment committee. Since 2016 he has been a board member at the €409bn civil service scheme ABP as well as Het Nederlandse Pensioenfonds, the general pension fund (APF) established by insurer ASR. Between 1998 and 2014 Van Vliet worked at Ortec Finance, latterly as managing director and partner.Loomis Sayles – The $267bn (€216bn) asset manager has appointed Kathleen Bochman as director of environmental, social and governance (ESG), a newly created role. She will lead the company’s existing ESG committee, providing strategic support to investment teams and the wider firm. Bochman has worked at Loomis Sayles since 2006, and previously held investment roles at Wellington Management and State Street Research & Management.BMO Global Asset Management – Zahra Sachak is BMO’s new director of relationship management in its UK institutional team, where she will oversee relationships with existing clients. She joins from Investec Asset Management where she worked in the North America institutional sales team. Sachak has also worked at Aviva Investors and Schroders.Fidante Partners – The investment manager has hired Hugh Ferrand to its institutional business development team. He joins from Invesco Perpetual, the UK arm of global asset management giant Invesco, where he oversaw its institutional business with pension schemes, charities, endowment funds and insurance firms. Prior to joining Invesco in 1999, Ferrand worked as an investment manager at Adam Bank and Blairlogie.eVestment – The data and analytics provider has named David Keogh as managing director for the Europe, Middle East and Africa (EMEA) region. Based in London, he will be responsible for growing eVestment’s client base in the EMEA region. He has worked in various management and business development positions at companies including Accenture, Barclays and Banco Santander.IFM Investors – The Australian fund manager has appointed former Industry Super Australia chief executive David Whiteley as global head of external relations. He will join in September to lead the firm’s public policy agenda. He will have global responsibility for the firm’s relationships with government, media, shareholders and industry groups.IFM Investors’ CEO, Brett Himbury, said: “Central to the role will be an emphasis on directing IFM Investors’ global responsible investment initiatives and its focus on enhancing returns, as well the societies in which we invest.”last_img read more