STATE : CalPERS Joins Lockheed Battle

The California Public Employees Retirement Fund said today it has voted its 500,000 shares of Lockheed in favor of a dissident slate of directors led by investor Harold Simmons.

CalPERS holds only about 1% of the aerospace and defense company, but a CalPERS spokeswoman said other large institutional holders have said they share the pension fund’s concerns.

The move by CalPERS points to the possibility that the contentious proxy fight launched by Simmons last month could be closer than expected when the votes are counted at Lockheed’s annual meeting Thursday.

CalPERS, the nation’s largest pension fund, said it backed Simmons’ slate largely because of a commitment from the dissident investor to establish a formal mechanism through which shareholders can communicate with company directors.

Simmons, a Dallas-based investor who owns 19% of Lockheed, is seeking to unseat the company’s 15-member board after a year in which Lockheed’s stock has plummeted.