CalPERS backs three managers

US state pension fund CalPERS has backed a trio of emerging managers as part of its manager development programme, and has also acquired small stakes in two of the investment groups.

The California Public Employees' Retirement System (CalPERS), the largest state pension plan in the US, has committed $400 million to three emerging managers.

The pension plan has earmarked $150 million for Paris-based TOBAM, an institutional investment group focusing on quantitative core strategies, it said in a statement.

It has committed the same amount to San Francisco-based Victoria, an emerging markets-focused investment group.

CalPERS has taken a minority stake in both TOBAM and Victoria as part of the deals, it said.

A third manager, Quotient, has received a $100 million commitment from CalPERS for its environmental, social and governance-focused investment fund. Quotient is already part of the pension plan's manager development programme.

All three commitments were made using the pension plan's Manager Development Program II funding vehicle which targets public equity investments. MDP II provides assets to small and emerging public equity firms with no more than $2 billion of assets under management, CalPERS said. It also supplies venture capital in exchange for significant but minority equity stakes.

Joseph Dear, chief investment officer at CalPERS, said: “These emerging managers will play an important role in our effort to nurture potential diverse major players in the financial markets.”

The commitments were sourced through MDP II's two advisors, CalPERS said. Legato Capital Management suggested Victoria, while Strategic Investment Group put forward TOBAM.