LPPI mulls taking on Brunel business as final LGPS funds pick pools

Six Local Government Pension Scheme (LGPS) funds are yet to select a new pooling partner after the government ordered two of the eight asset pools, Brunel and ACCESS, to be shut down earlier this year.

A document from Avon Pension Fund’s committee, which meets later this week to decide its fund’s pool of choice, states that “LPPI is likely, on the basis of initial discussions, though this is not guaranteed, to integrate the Brunel business”.

The document also states that “a material number of Brunel funds are likely to join LPPI”. The £6.1bn Devon Pension Fund has already declared its intention to do this (see below).

Pensions Expert has approached LPPI and Brunel for comment. A spokesperson for LPPI said the pool does not comment on “market speculation”.

The Brunel business includes nine sub-funds invested in listed equity and bond markets, and passive equity and bond strategies run by Legal & General Asset Management and BlackRock.

Brunel also runs private markets strategies across property, infrastructure, private equity, and private debt, as well as a dedicated impact portfolio for the Cornwall Pension Fund.

Six Brunel partner funds are yet to publicly confirm which pool they will move to. These are Avon – although its consultant KPMG has recommended it selects LPPI – Buckinghamshire, Cornwall, Dorset, the Environment Agency and Somerset. Between them, they have approximately £24.8bn in assets under management, according to data from PensionsPerformance.com.

LPPI currently manages £26.5bn for three LGPS funds.

Devon opts for LPPI as new pooling partner

The Devon Pension Fund today announced that it plans to join LPP, which currently oversees the investments of the Lancashire and Berkshire LGPS funds as well as the London Pensions Fund Authority.

At a meeting last week, Devon’s investment and pension fund committee approved the decision to join LPPI “as a shareholder and client”.

In a statement, the pension fund said its staff had been “very focused on taking forward the best of what has been achieved through Brunel into the new pooling arrangements”.

“Work will now begin on working with LPPI and Brunel colleagues on achieving that objective.”

“This decision marks the beginning of an exciting collaboration where we will work together to achieve Devon Pension Fund’s strategic goals and bring the advantages of pooling to its members, employers, and taxpayers.”

Chris Rule, LPPI

LPPI chief executive Chris Rule said: “We are really pleased that Devon Pension Fund has selected LPPI as their preferred pool following a thorough due diligence process.

“This decision marks the beginning of an exciting collaboration where we will work together to achieve Devon Pension Fund’s strategic goals and bring the advantages of pooling to its members, employers, and taxpayers.”