BlackRock Given £4 Billion Private Equity Investment Mandate By UK Pension Scheme

Published On: September 22, 2020Categories: Stocks & Shares1.5 min read

The investment manager BlackRock has been selected as fiduciary manager of the £4 billion Civil Aviation Authority Pension Scheme (CAAPS) growth portfolios. It is reported that BlackRock’s expertise in striking private equity deals, as well as having been judged “a good cultural fit”, led to it securing the role.

BlackRock will provide asset allocation and manager-selection decisions on investments across all asset classes. Growth investment portfolios of the kind of defined benefit pension scheme that CAAPS is an example of, typically have a heavy weighting towards private equity investments.

The scheme is made up of two constituent investing on behalf of the pension fund of workers in the aviation industry – the Civil Aviation Authority and National Air Traffic Services. Between them, CAAPS scheme has around 14,000 members and control around £7.25 billion worth of assets.

Joanna Matthews, the independent chair of CAAPs said that BlackRock was selected as the fiduciary manager of the two growth portfolios on the basis of being judged “a good cultural fit and they clearly demonstrated the strength of their investment offering and the scale and depth of their resources”.

Commenting on behalf of BlackRock was Sarah Melvin, head of the U.S. giant’s UK unit. She said that her company is looking forward to assisting CAAPS members in achieving their long-term financial goals through successful allocation of their pensions capital, commenting:

“A vast number of schemes are currently navigating an uncertain global environment, and more and more making the decision to outsource. Our problem-solving approach to fiduciary management has resonated very well with CAAPS and we are thrilled that they have chosen BlackRock as their partner to manage their growth portfolios.”

CAAPs members will benefit from insights provided by BlackRock’s proprietary Aladdin platform, that now plays a key role in helping assess the risk to return qualities of potential investments, informing levels of private equity funding. This, added Melvin, helps BlackRock  build portfolios designed to provide more stable returns over the long term, hopefully boosting the pension pots of thousands of CAAPS members.

About the Author: Jonathan Adams

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