(Reuters) - Mercer Investment Management Inc has terminated Pacific Investment Management Company LLC and Western Asset Management Company as subadvisers to the Mercer Core Fixed Income Fund, effective immediately, according to an SEC filing on Thursday.
Income Research & Management and Prudential Investment Management Inc will serve as the new subadvisers to the Mercer Core Fixed Income portfolio, the filing added.
A spokesman for Mercer declined to comment on the total amount removed from Pimco and Western Asset.
Pacific Investment Management Co has been rattled by a management shakeup and disappointing performance. Investors pulled $7.3 billion from Pimco's U.S. open-end mutual funds in March, the 10th straight month of outflows for the Newport Beach, Calif. firm, according to Morningstar data.
Pimco, overseen by Bill Gross, had $15.45 billion of outflows from U.S. open-end mutual funds in the first quarter, Morningstar said.
Reuters reported on Monday that Pimco was also removed as the subadviser of two bond funds totaling $3.7 billion offered by ING U.S. Investment Management, according to another regulatory filing.
In mid-March, TCW Group Inc said it replaced Pimco as the subadviser of a $1.3 billion bond fund offered by Columbia Management Investment Advisers LLC.
Mutual fund subadvisers are money managers hired by a fund's adviser to run all or a portion of a fund's assets under the direction of the adviser, who is otherwise accountable directly to the fund's board.
It has become popular in recent years, for example, for financial firms without specific portfolio management expertise to set up funds and then farm out the actual day-to-day management responsibility to one or more asset managers who act as subadvisers.
(Reporting by Jennifer Ablan; Editing by James Dalgleish)