River and Mercantile Group PLC (R&M) is set to complete the transition and onboarding of £1.16bn of mandates from the Smurfit Kappa UK Pension Fund (Smurfit Kappa UK).

Smurfit Kappa UK awarded the mandates, which comprise a fiduciary management mandate of c.£630m and an LDI allocation of c. £530m, in January.

Smurfit Kappa UK was one of the earliest adopters of Fiduciary Management (FM) in the UK. Smurfit Kappa UK worked with PWC to run a full market retendering process following the Investment Consultancy and Fiduciary Management Market Investigation Order 2019 and, after a review of the Requests for Proposal, the board of trustees met with seven providers including the existing managers.

The decision was taken to award the mandate to River and Mercantile, which was not one of the incumbents.

Commenting on the decision, Tom Gallagher, Pension Manager of Smurfit Kappa UK Pension Fund said:

“The dynamic strategic management of our new FM partner was an important factor in our selection and we are confident such an approach can best capture opportunities through this challenging period. It is what we expect of our Fiduciary Manager. The Board was also impressed by R&M’s ability to provide segregated derivative solutions combined with bespoke cashflow matching to each section, which we believe is really innovative and unique in the market. We are confident this new partnership will offer long term financial security for members”.

Leading the PWC team that advised the Smurfit Kappa UK Pension Fund, Director Keira-Marie Ramnath said:

“We are delighted to be working with the trustees to independently review their investment arrangements. The Fiduciary Management selection process was highly competitive and against a backdrop of regulation being finalised, we had to work hard to ensure an apples with apples comparison. The result is that the trustees have adopted a solution which is innovative, bespoke to their needs, and delivers immediate cost savings, this is a great result for members.”

Co-Head of River and Mercantile Solutions (UK), Ajeet Manjrekar, noted:

“We appreciate the confidence and trust in us shown by the Smurfit Kappa UK Pension Fund Trustees, advised by PWC. To win such a prestigious mandate against serious competition demonstrates that we have a very competitive proposition in a market where we are the longest established name.”