Compliance December 28, 2012

Pension Fund Sues NYSE Euronext

A pension fund is leading a class-action lawsuit against NYSE Euronext.
Reported by

The New Jersey Carpenters Pension Fund contends that NYSE Euronext and the suit’s other defendants breached their fiduciary duties and due care in the $8.2 billion proposed sale of NYSE to IntercontinentalExchange Inc. 

The pension fund claims the deal would undervalue the exchange’s stock.

Want the latest retirement plan adviser news and insights? Sign up for PLANADVISER newsletters.

“The buyout is the product of a flawed process designed to ensure the sale of NYSE Euronext to ICE on terms preferential to ICE and designed to benefit NYSE Euronext’s insiders,” the pension fund said in its complaint, filed Friday in the Supreme Court of the State of New York.

The fund also claims the defendants hired financial advisers who were professionally and financially tied to them.

NYSE Euronext Shareholder Samuel Cohen also filed a proposed class action Friday over the proposed deal in the Delaware Chancery Court. The New Jersey Carpenters Pension Fund’s complaint is available here.

The Markets December 24, 2012

Seattle Asked to Divest from Fossil Fuels

The City of Seattle is moving to divest from fossil fuels following a roundtable discussion with environmental activist and 350.org founder Bill McKibben.  
Reported by

While none of the city’s $1.4 billion in cash balances for daily operations is currently invested in fossil fuels, Seattle Mayor Mike McGinn is seeking to rid the city’s deferred compensation (DC) plan and pension holdings of fossil fuel investments. The city’s DC plan has $700 million in employee investments, while the pension system has holdings valued at $1.9 billion.

McGinn does not control those funds, but he wrote to the Deferred Compensation Plan Committee “to ask that they offer our employees options to move their investments out of fossil fuel companies, offer fossil fuel free investment choices to them, and begin the process of divestment,” McGinn said on his blog. McGinn also asked the city’s pension system governing board to “refrain from investing in fossil fuel companies in the future, and begin exploring options for moving existing investments from fossil fuel companies.”

Two of the pension system’s top 10 investments are with ExxonMobil and Chevron, according to McGinn. The system currently has $17.6 million invested with those two firms, representing just less than 1% of their $1.9 billion in assets.

350.org is calling for schools, churches and governments to immediately freeze any new investment in fossil fuel companies, and divest from direct ownership and any commingled funds that include fossil fuel public equities and corporate bonds within five years.

«