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VRS - who has written 14997 posts on Opalesque Sovereign Wealth Funds Briefing.


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Sovereign wealth funds: Stash or spend?

Posted on 22 October 2014

Resource-rich regions have various ways of sharing the wealth. Some are more jovial than others. On October 2, every person living in Alaska was given $1,884. Although the amount was, as Time magazine noted, enough to buy a trip someplace warmer, the state’s cash-for-residency deal is just as likely to sell one-way tickets going north.

Nigeria’s Sovereign Wealth Fund: Investment plans unaffected by falling oil prices

Posted on 22 October 2014

Nigeria’s sovereign wealth fund said its investment programme over the next six months, including on infrastructure, will go ahead, even as revenues that provide its capital are hit by falling oil prices.

Zambia needs wealth fund

Posted on 22 October 2014

In the 2015 national budget Government, through the Ministry of Finance, has set aside K100 million towards the creation of a sovereign wealth fund. Minister of Finance Alexander Chikwanda has proposed that the fund be housed by Zambia’s nascent investment vehicle, the Industrial Development Corporation (IDC).

Sweet deal for GlobalFoundries and Mubadala

Posted on 22 October 2014

IBM is paying GlobalFoundries $1.5 billion to acquire IBM’s global commercial semiconductor technology business, including intellectual property, world-class technologists and technologies related to IBM Microelectronics. The acquisition is a win for GlobalFoundries and for Abu Dhabi.

SOFAZ budget revenues exceed 10 bln manats

Posted on 22 October 2014

The budget revenues of Azerbaijan’s state oil fund SOFAZ reached 10.131 billion manats in the third quarter of 2014. This comes as the fund’s budget expenditures constituted 8.041 billion manats during the same period of time.

Only 4.4% of SOFAZ investment portfolio intended for active investment

Posted on 22 October 2014

The State Oil Fund of Azerbaijan (SOFAZ), known for its conservatism, intended no more than 4.4% of its investment portfolio or about $1.639 bn for active investment instruments.

GIC buys office space in Tokyo

Posted on 22 October 2014

Singapore sovereign wealth fund GIC has acquired an office component within a building in central Tokyo, estimated to cost about 170 billion yen (S$2 billion). The 32-storey high Pacific Century Place Marunouchi was acquired through a GIC affiliate, said GIC in a statement today (Oct 21).

Investors in Japanese Property Look Beyond Tokyo

Posted on 22 October 2014

When it costs nearly $2 billion to buy just part of a building in a prime Tokyo location, it is no wonder some investors in Japanese property are looking farther afield. Singapore sovereign-wealth fund GIC Pte. Ltd. said Tuesday it bought 24 floors of Pacific Century Place Marunouchi, a building next to Tokyo Station, in [...]

GIC Buys Tokyo Building in Bet on Rising Property Prices

Posted on 21 October 2014

GIC Pte, Singapore’s sovereign wealth fund, bought a building next to Tokyo Station in a bet that the city’s real estate values will continue to rise. GIC paid $1.7 billion for the property, according to a person familiar with the purchase who asked not be named because the information isn’t public. The fund, which declined [...]

Libya-Goldman clash sheds light on formerly secretive fund

Posted on 21 October 2014

In 2008, Catherine McDougall was a young Australian lawyer seconded to the Libyan Investment Authority’s offices in Tripoli to assist its legal team and review financial transactions conducted by Goldman Sachs. She was “shocked” by what she learnt, according to her witness statement detailed in a London court earlier this month.

QIA, Lau mull Lifestyle takeover

Posted on 21 October 2014

Qatar Investment Authority (QIA) and Hong Kong’s Lau family are considering options, including a full takeover of department store operator Lifestyle International Holdings Ltd, after the sovereign wealth fund bought a minority stake, according to people with knowledge of the matter.

Qatar Fund to Pay $616M for Stake in Hong Kong Retailer

Posted on 21 October 2014

Qatar Investment Authority agreed to pay about HK$4.78 billion ($616 million) for a stake in a Hong Kong department store operator as the sovereign wealth fund diversifies its global portfolio.

Can Nigeria Achieve A $6.3bn Excess Crude Account?

Posted on 21 October 2014

At the recently concluded IMF/World Bank Annual Meetings, the World Bank, arguably prompted by recent global trends such as the drop in oil prices, had advised the Nigerian Federal Government to increase its fiscal buffers by raising the excess crude account from $4.1 billion to $6.3 billion, a 54 percent increase.

State Oil Fund of Azerbaijan does not buy physical gold for 2 quarter at a run

Posted on 21 October 2014

The State Oil Fund of Azerbaijan (SOFAZ) has not bought physical gold for two quarters (Q2 and Q3 of 2014) at a run. The Fund informs that as of 1 October it had physical gold in the amount of $1.18 bn that was equivalent to 3.2% of its investment portfolio ($37.265 bn.

Oil Fund’s assets for Jan-Sept exceed $37.305 bn

Posted on 21 October 2014

The State Oil Fund of Azerbaijan (SOFAZ) increased its assets by 3.98% for Jan-Sept 2014. According to SOFAZ, over the past 9 months of the year Oil Fund’s assets grew from $35.877 bn in early 2014 up to $37.305 bn. “During the first 9 months of 2014 Oil Fund’s revenues totaled AZN 10.1 bn and [...]

Mainstream media gloss over GIC’s $269 million capital loss

Posted on 21 October 2014

GIC had actually bought the property in June 2007 when the British pound was very strong against our currency at about 1GBP=$3.06. When converted into local currency, the purchase price would be a whopping $1.469 billion. GIC had therefore made a capital loss of about $269 million, a huge embarrassment to the government.

SWFs and pensions diversify into new markets and asset classes

Posted on 21 October 2014

In Asia Pacific, sovereign wealth funds (SWFs) and pension funds have been diversifying their investments into new markets and asset classes. Alternatives are now playing a larger role in their investment portfolios. According to Dan McNicholas, head of alternative investment sector solutions, Asia Pacific, at State Street, these are more complex investment strategies.

Qatar fund to buy stake in HK department store operator for $616 mln

Posted on 20 October 2014

Qatar Holding LLC has agreed to pay $616 million for about one fifth of Lifestyle International Holdings, a department operator in Hong Kong and mainland China - the latest addition of a high-end retail brand to the sovereign wealth fund’s portfolio.

Qatar eyes $15bn Greater China spending spree

Posted on 20 October 2014

Qatar’s purchase of a stake in a Hong Kong department store chain is the beginning of a potential $15bn spending spree targeting Greater China, according to people familiar with the Gulf state’s plans. Qatar Holding, which owns stakes in Harrods, Barclays, Credit Suisse and Canary Wharf Group among others, on Monday said it would pay [...]

How Qatar funds extremists across the Middle East

Posted on 20 October 2014

Qatar is the richest country in the world per capita - and has made significant investments into various iconic London landmarks. Its sovereign wealth fund owns Knightsbridge department store Harrods and its property arm has invested substantially in the development of Chelsea Barracks. It also owns the Shard - currently the tallest building in the [...]

TIH wraps up S$129m in acquisitions from Temasek Holdings

Posted on 20 October 2014

Private equity fund TIH Limited’s subsidiary TIHT Investment Holdings has completed a S$129 million acquisition of assets from Temasek Holdings. This comprises a minority interest in CEI Contract Manufacturing Limited and the assignment of beneficial ownership in a minority interest of Mitsui Life Insurance Company Limited.

SOFAZ revenues more than $2 bn from “Shah Deniz”

Posted on 20 October 2014

The reserves are estimated at 1.2 trl of cubic meters of gas. As of October 1, 2014, since 2007 the revenues of the State Oil Fund of Azerbaijan (SOFAZ) from the project of gas condensate field “Shah Deniz” in the Azerbaijani sector of the Caspian Sea amounted to $2,006 m.

As IPO markets stumble, private equity buyers prepare to swoop

Posted on 20 October 2014

Across Europe, companies hoping to list are having their plans dashed by plunging equity prices. But what’s bad for public stock markets may be good for private equity firms. Having started the year with a record $1 trillion cash pile, private equity funds have found few chances to spend it, despite pressure from investors wanting [...]

Watch Out Banks: BAML Steps Up Game on Sovereign Wealth Funds

Posted on 20 October 2014

Bank of America Merrill Lynch (BAML) is seeking to expand ties into the Middle East and Asia, while some European banks struggle to get their houses in order. The bank was recently the global coordinator for Jimmy Choo’s initial public offering in which an Asian sovereign wealth fund became the second largest shareholder in [...]

Foreign interests trying to exploit my fragile nation, says Timor PM Xanana Gusmao

Posted on 20 October 2014

Foreign interests are trying to “dominate” East Timor, exploiting the fragility of the tiny nation to deny its rightful share of the oil and gas revenues in the Timor Sea and sow unrest, its Prime Minister says. Xanana Gusmao made the remarks as the fledgling state is embroiled in bitter fights with the Australian government [...]

1MDB not national sovereign wealth fund? What is it, then?

Posted on 17 October 2014

Prime Minister Datuk Seri Najib Razak’s controversial pet cash cow spin, 1Malaysia Development Berhad (1MDB), has denied that it is the country’s second national Sovereign Wealth Fund (SWF), after Khazanah Nasional. In an Oct 9 posting on its webpage titled “Frequently asked questions (FAQ) about 1MDB”, it reiterated that 1MDB was a strategic development company, [...]

Future Fund focuses on finding the best people

Posted on 17 October 2014

Australia’s sovereign wealth fund, the A$101 billion Future Fund, has just upped the stakes in not only attracting the best co-investment deals from fund managers, but in its bid to attract the world’s best investment professionals. Two months ago the fund’s long serving chief investment officer, David Neal, become chief executive in name (following the [...]

Citycon acquires GIC’s ownership stake in the Iso Omena shopping centre

Posted on 17 October 2014

Citycon has today agreed to acquire GIC’s 40 per cent stake in the Iso Omena shopping centre in the Helsinki region. After this transaction, Citycon owns 100 per cent of the existing shopping centre. The purchase price is in line with the current fair value of Iso Omena. GIC has been a co-investor in [...]

Temasek-Penang project seeks global names as tenants

Posted on 17 October 2014

The upcoming mixed-use development in Penang by Temasek and Penang Development Corporation (PDC) is targeting international companies as tenants in a bid to bolster Penang’s role as a major business process outsourcing (BPO) hub.

Where did RM4 billion for Putrajaya’s SRC International go, asks DAP

Posted on 17 October 2014

Prime Minister Datuk Seri Najib Razak must explain what has happened to a RM4 billion loan secured by a wholly-owned subsidiary of the Ministry of Finance, which failed to submit its annual accounts on time, a DAP lawmaker said today.

Sovereign wealth fund should sit at BoZ-Deputy Governor

Posted on 17 October 2014

The Bank of Zambia has suggested that the proposed setting up of a sovereign wealth fund should be housed at the central bank. Finance Minister Alexander Chikwanda announced during the budget presentation that K100 million was allocated for the establishment of a sovereign wealth fund and suggested that the fund will be housed under the [...]

Oil keeps Kuwait’s economy strong, for now

Posted on 17 October 2014

Moody’s indicated that Kuwait owns $400 billion worth of assets in its sovereign wealth fund, i.e., twice the GDP. There is no doubt that these assets generate adequate returns to Kuwait, thus consolidating its sovereign revenues. Kuwait was able to boost the value of these assets, given its ability to achieve significant financial surpluses in [...]

Afghanistan, Kazakhstan ready to join BTK project

Posted on 17 October 2014

Afghanistan and Kazakhstan are interested in joining the Baku-Tbilisi-Kars (BTK) railway project, Azerbaijan’s Transport Minister Ziya Mammadov told reporters on Oct.16. He made the remarks on the sidelines of the “Baku-Tbilisi-Kars railway line - new opportunities in the development of the Silk Road” international conference in Baku.

BlackRock’s Fink says sovereign wealth funds are staying in equities -CNBC

Posted on 16 October 2014

U.S. asset manager BlackRock Inc has not seen more than one sovereign wealth fund sell out of equities in last six weeks despite the global market volatility, Chief Executive Officer Larry Fink told CNBC Wednesday morning.

Blackstone Joins Mideast Funds for Stake in Dubai’s GEMS

Posted on 16 October 2014

Blackstone Group LP is taking a stake in GEMS Education, the world’s biggest privately held schools operator, as part of a group of investors led by Dubai-based Fajr Capital Ltd.

Future Fund ‘could review fossil fuels’

Posted on 16 October 2014

The commonwealth Future Fund has indicated it could review its fossil fuel investments if demand for green energy increased. The comments come as Prime Minister Tony Abbott blasts the Australian National University’s “stupid decision” to offload its fossil fuels portfolio.

Future-proofing the Future Fund

Posted on 16 October 2014

In delivering the Future Fund’s best two-year return since its inception seven years ago, managing director David Neal took great pains to point out that recent returns are not sustainable. The Future Fund, set up by then treasurer Peter Costello in 2006, generated a return of 14.3 per cent for the fiscal year to June, [...]

Khazanah’s SCR offer ‘fair’, says MAS

Posted on 16 October 2014

Malaysia Airlines (MAS) says its minority shareholders should accept Khazanah Nasional Bhd’s proposed selective capital reduction and repayment exercise (SCR) for the national airline as it is “fair”. MAS directors yesterday recommended the plan after the audit committee found parent Khazanah’s offer fair and reasonable, MAS said in a filing to Bursa Malaysia.

MAS asks shareholders to take Khazanah’s RM1.38b offer

Posted on 16 October 2014

Malaysian Airline System Bhd., the carrier reeling from the crash of two planes this year, said small shareholders should accept a buyout offer from the carrier’s majority owner as it called the proposal fair. The airline’s directors recommended the plan after the audit committee found parent Khazanah Nasional Bhd.’s offer fair and reasonable, the Subang, [...]

Nigeria: World Bank Tasks FG to Raise Excess Crude Account to U.S.$6.3 Billion

Posted on 16 October 2014

The World Bank has advised the federal government to increase its fiscal buffers by raising the excess crude account (ECA) to $6.3 billion. Finance Minister, Dr. Ngozi Okonjo-Iweala, disclosed this in Washington DC, saying the World Bank tasked the Federal Government on the need to increase its fiscal buffers by building external reserves to about [...]

Kazakhstan’s Alliance Bank says near completion of debt restructuring, merger

Posted on 16 October 2014

Kazakhstan’s Alliance Bank ALLBy.LU, majority owned by the country’s sovereign wealth fund, is close to completing a $1.2 billion debt restructuring and a merger with two other banks, its chief executive said on Wednesday.

Georgian minister to tell about his country’s transit potential at conference in Baku

Posted on 16 October 2014

Georgian Regional Development and Infrastructure Minister David Shavliashvili departed for Baku, Azerbaijan. He will take part in an international conference titled “The Baku-Tbilisi-Kars railway – new opportunities for development of the historical Great Silk Road.”

Norway’s wealth fund buys Munich office buildings

Posted on 15 October 2014

Norway’s $840-billion sovereign wealth fund purchased a 94.9 percent stake in several firms that own two office buildings in Munich’s Lenbach Gärten quarter, the fund said on Tuesday. The fund purchased the stakes from AM Alpha GmbH for a total consideration of 176.1 million euro, including 75 million euro of third-party debt, it said in [...]

Norwegian oil fund snaps up office properties in Munich

Posted on 15 October 2014

Norges Bank Investment Management has bought its first properties in Munich on its own. The Norwegian sovereign wealth fund has paid AM Alpha €176.1m for two office assets in the centre of the German city. The deal is the fund’s first German purchase without a partner.

Indian President Pranab in lobbyist role; Noway SWF

Posted on 15 October 2014

President Pranab Mukherjee, blamed by some for driving away foreign investment as a UPA finance minister, is this week donning the mantle of chief lobbyist to re-ignite interest from Europe’s largest sovereign wealth fund — for Prime Minister Narendra Modi.

1MDB on PAC’s radar but no scheduled interview yet, chief says

Posted on 15 October 2014

The 1Malaysia Development Bhd (1MDB) is now on the Public Accounts Committee (PAC) “radar” but the influential panel has no plan to haul up executives from the sovereign fund despite opposition claims of financial improprieties. Committee chief Datuk Nur Jazlan Mohamed said today that PAC’s priority was to investigate issues raised by the Auditor General [...]

1MDB awarded 2,000MW power plant in Melaka-The Edge

Posted on 15 October 2014

The government has confirmed the award of the 2,000MW combined cycle gas power plant in Melaka to 1Malaysia Development Bhd (1MDB), which is deemed crucial for the sovereign wealth fund to list its power assets on the local bourse by year-end or sometime early next year.

1MDB Awarded Contract Via Direct Negotiation

Posted on 15 October 2014

The Government has awarded 1Malaysia Development Bhd (1MDB) a contract to build a 2,000-megawatt (MW) power plant in Malacca via direct negotiation. The Energy, Green Technology and Water Minister Datuk Seri Dr Maximus Ongkili confirmed awarding the multi-billion contract to 1MBD via a written reply to DAP lawmaker Tony Pua last week.

Putrajaya bailing out 1MDB by boosting IPO value, says DAP lawmaker

Posted on 15 October 2014

Putrajaya is bailing out 1Malaysia Development Bhd (1MDB) through several power plant projects worth billions of ringgit, DAP national publicity secretary Tony Pua said. Pua, the Petaling Jaya Utara MP, questioned the latest power project awarded to 1MDB – a 2,000MW gas-turbine power plant in Malacca given via direct negotiation.

Penang woos Singapore investors following Temasek deal

Posted on 15 October 2014

Amid a spat with Putrajaya over federal assistance to draw investors to Penang, the state government will boost its efforts to draw more Singaporean investors following its recent partnership with the republic’s Temasek Holdings to develop a RM11.3 billion business and a technology hub.

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