Gov. Arnold Schwarzenegger says he will sign legislation to end state investment in companies that do business with Iran.
The bill, passed earlier this month by the California Legislature, would ban the United States' two largest public pension funds - the California Public Employees Retirement System and the State Teachers Retirement System - from investing in companies that work on defense or nuclear projects or are involved in developing Iranian petroleum or natural gas resources.
"I look forward to signing legislation to divest from Iran to take an equally powerful stand against terrorism," Schwarzenegger said in a statement Monday. The signing could come this week, said spokesman Aaron McLear.
CalPERS estimated the ban would require it to divest an estimated $2 billion from 10 companies.
California, which passed a similar law last year regarding investments in Sudan, is among several states to take financial action against Iran. Similar legislation is pending in Congress.