E.ON £5bn UK pension scheme appoints investment advisor

London-based Cardano has been appointed to provide asset allocation, management selection and other advisory services for all asset classes

The UK pension scheme of German utility giant E.ON has appointed Cardano as investment advisor on sectors including real estate allocation and manager selection.

Trustees of the £5 billion (€5.5 billion; $7.5 billion) scheme have asked London-based Cardano to advise on investment arrangements for all the asset classes. The brief includes liability hedging.

Neil Smith, chief executive of the E.ON UK Pension Scheme, said in a statement it wanted to adopt a “more dynamic” and “flexible approach” to its investment strategy. “Recent events have shown how important it is for trustees to focus on the funding position and to manage risks but also to adopt an innovative approach to generating returns,” he said.

The pension scheme did not release any further details of its allocations or exposure to real estate.

According to a 2006 annual report, the E.ON UK Group of Electricity Supply Pension Scheme had a 5.7 percent allocation to property, short of a 10 percent target, with £200 million invested in the asset class.

The report said Merrill Lynch and F&C were its property fund managers.