The C$2.5bn (US$1.7bn) City of Montreal Pension Fund is set to tender for a manager to run a combined Brady bonds and high yield mandate in September, according to Johnny Quigley, the fund's controller.
Currently, the fund is studying various high yield and Brady bond products, and Quigley said that once that finishes in early September, the mandate will be put out to tender. The brief will be worth between C$100m (US$66m) and C$140m (US$92.6m), Quigley said.
Interested managers can contact Quigley on 001 514 872 5894.
Additionally, Quigley revealed that Baillie Gifford is to receive extra funding for its global equities mandate. Last month, IPN reported that Baillie Gifford had retained its C$150m (US$98m) global equities mandate, and Quigley said that it will now receive an additional C$40m (US$26m) to C$50m (US$33m).
Earlier this year the fund put a total of C$400m (US$261.4m) in global equities mandates out to tender. Sprucegrove Investment Management and BPI Global Asset Management were both awarded C$100m (US$65.3m) mandates as a result of the tendering process. Baillie Gifford’s C$150m mandate was part of the C$400m that had been put up to tender.
Quigley also revealed last month revealed that one of the fund's existing global equities managers would be terminated, but declined to say which. The terminated manager’s brief is where Baillie Gifford’s additional funding will come from.
* Brady bonds are securities that have resulted from the exchange of commercial bank loans, sometimes defaulted loans, into new bonds. The goal of that exchange is to reduce and restructure the debt of those less developed countries (LDCs) that have reformed their economic policies to the point where they can achieve economic growth and make timely payments on their (now reduced) debt obligations.
The bonds are named after former US Treasury Secretary Nicholas Brady, who in late 1988 created the debt reduction plan for LDCs that resulted in the bonds' creation.
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