Goldman Sachs Asset Management is purchasing the portion of
Veruss outsourced chief investment officer business that
is focused on large pension plans.
Verus, based in Seattle, will transfer $21 billion in assets
under supervision to GSAMs outsourcing business, which
provides customized asset allocation, portfolio construction,
and risk management to corporate pensions, endowments,
foundations and insurers. Delta Air Liness pension plan
is one of the large clients being transferred to
GSAM, according to a person with knowledge of the deal. The
purchase, expected to be announced as soon as today, should
close by the middle of the year.
A GSAM spokesman declined to comment on any Verus
Jeffrey Scott, who is CIO of Verus and runs its strategic
partnership business, will be joining GSAM, whose outsourcing
business represents $93.5 billion in client assets.
Veruss deputy CIO Omer Tareen, Scott Day, a managing
director, and several supporting portfolio management staff and
analysts will also join GSAM. Scott, the former CIO of the
Alaska Permanent Fund Corp., joined Verus in 2011.
Verus will continue to provide outsourcing services to
mid-market institutional clients with assets below $5 billion.
Jeffrey MacLean, the firms CEO, says its large plan
business required technical and operational support that was
not key to its core business of mid-market plans.
This transaction allows Verus to go back to our
original strategy, which is to focus on OCIO opportunities that
are more in keeping with where we believe the market is: plans
that are smaller than $5 bill and have no internal
staffs, MacLean says. Verus will also keep its
traditional consulting, risk management and private markets
Goldman recently made a similar acquisition. GSAM announced
in 2015 a deal to buy Pacific Global
Advisors, a provider of investment and risk management services
to large pension plans, from Pacific Life Insurance Company.
The business had more than $18 billion of assets under
supervision at the time.