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Three Oxford colleges launch £100m investment pool

Oxford University’s Christ Church, St Catherine’s and Balliol colleges have pooled their resources to launch a £100m programme that will include private equity allocations.

Oxford Investment Management (Oxim) has been launched to manage assets owned by Oxford University’s Christ Church, St Catherine’s and Balliol colleges. Oxim will have an initial pool of £100 million (€143 million; $176 million) to invest, some of which will be committed to private equity funds.

A report in the Financial Times said Oxim has set aside 7.5 percent of the fund to private equity and another 7.5 percent to property. The strategy for the remaining 85 percent will be to simply identify outperforming fund managers rather than allocate set amounts to different types of assets.     

Eschewing more traditional approaches, Oxim co-head Karl Sternberg told the FT: “It’s a mistake to view private equity or hedge funds as simply another asset class, as the choice of manager is absolutely key.”

Sternberg, who graduated from Christ Church, is the former chief investment officer at Deutsche Asset Management and managed a £30 million portfolio of assets on behalf of St Catherine’s between 1994 and 2004. Fellow Oxim co-head Paul Berriman, a St Catherine’s graduate, was formerly CEO of Deutsche Asset Management’s UK arm.

Oxim’s investment committee includes Gavyn Davies, the former Goldman Sachs chief international economist and chairman of the BBC.

Joining Davies on the committee are Craig Baker and Alasdair MacDonald, head of European research and senior investment consultant respectively at consultants Watson Wyatt. Watson Wyatt was recruited by Oxim to identify 40 managers for consideration, from which 25 potential managers have been selected.

Underlining the scale of Oxim’s ambition, Berriman indicated that the strategy of the fund would be reviewed once it had grown to £1 billion. The fund is targeting real returns of more than five percent a year over rolling five-year periods and will launch officially next month with the aim of attracting new business from other colleges and charities.

Oxim is owned 60 percent by the colleges and 40 percent by its management, according to the FT.