San Diego Belatedly Hires Saba For $100M Mandate

Aug 19 2011 | 4:42am ET

After a brief delay—and a contentious board meeting—the San Diego County Employees Retirement Association has become the newest client of Saba Capital Partners.

The $8 billion public pension’s board approved the $100 million allocation to the New York-based hedge fund, but not without some drama. Dan McAllister, the county’s treasurer and tax collector, and a member of SDCERA’s board, voted against hiring Saba and openly questioned the move, prompting an angry exchange between McAllister and another board member.

McAllister took issue with the board’s rethink on Saba—it deadlocked on the allocation last month—and brought up Saba founder Boaz Weinstein’s role in losing $1.8 billion as a proprietary trader for Deutsche Bank in 2008.

“This is the absolute best in the world?” McAllister asked portfolio strategist Lee Partridge of Salient Partners. McAllister complained that Partridge had failed to mention that loss at a previous meeting.

But McAllister’s efforts were in vain: Saba was approved by a five-to-one vote.

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