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Sovereign Wealth Funds Briefing - Category | Market more

The Future Fund brushes off a divestment push

Posted on 03 September 2015 by VRS  |  Email |Print

For all the attention that ethical investing has received in recent times, with super funds and city councils alike casting an increasingly wide interpretation over environmental, social and governance issues, the Future Fund appears disinterested.
The $117 billion sovereign wealth fund hasn’t signed up to the broad United Nations Principles of Responsible Investing, although many of the fund managers it hires have done so. The United Nations principles are a basic starting point, committing institutional investors who sign up to act “in the best long-term interests” of their beneficiaries. The principles state that ethical issues can affect the performance of investments………………………………………..Full Article: Source

Future Fund boosts cash levels above $20 billion as risks rise

Posted on 03 September 2015 by VRS  |  Email |Print

Australia’s sovereign wealth fund, the Future Fund, has shifted more of its assets into cash as it fears rising investment risks that won’t be matched by higher returns. In a portfolio update released on Wednesday, the fund showed it had moved an extra $5 billion into cash since its March update to make it more than 20 per cent of the total portfolio.
The cash balance has more than doubled since September last year, when the Future Fund held $10 billion. The Future Fund delivered a strong 15.4 per cent return for the financial year to June 30, adding $15.6 billion to investment returns that have increased the fund’s size to to $117.2 billion………………………………………..Full Article: Source

Australia’s giant Future Fund has been ditching stocks in favour of cash

Posted on 03 September 2015 by VRS  |  Email |Print

Australia’s future fund is hoarding cash, and ditching stocks, amidst renewed market volatility. The fund, created in 2006 and chaired by former Australian treasurer Peter Costello, released its latest portfolio update earlier today, revealing the fund upped its allocation to cash as at the end of the June quarter.
There have been some big changes, with a distinct movement from stocks to cash. Over the three months the funds allocation to Australian stocks was slashed by 17.2% to $7.957 billion. While part of that will be as a consequence of market falls – the ASX 200 slipped 7.34% over the quarter – it only partially explains the decline………………………………………..Full Article: Source

Liquidity’s their happy place as fund managers cut risk and wait for bargains

Posted on 03 September 2015 by VRS  |  Email |Print

Cash is king for now, according to Australian fund managers, who say stock buying opportunities will abound once the battered Australian market dives into official bear territory. Wilson Asset Management investment analyst Martin Hickson, Beulah Capital chief investment officer Peter Mavromatis​, Peak Asset Management executive director Niv Dagan​ and Prime Value Asset Management co-chief investment officer ST Wong all say they have moved heavily into cash in recent months.
Australia’s sovereign wealth fund, the Future Fund, also revealed on Wednesday that it had moved an extra $5 billion into cash since its March update. Cash now makes up 20 per cent of the portfolio, double the proportion of this time last year………………………………………..Full Article: Source

Temasek-backed driller amends bonds second time amid oil rout

Posted on 03 September 2015 by VRS  |  Email |Print

Integradora de Servicios Petroleros Oro Negro, a Mexican oil-rig operator partly owned by Singapore’s Temasek Holdings Pte, is again amending bond covenants as it struggles to win new contracts.
Noteholders agreed at a meeting Tuesday on changes to the company’s US$175 million of securities that come due in December, for a second time this year. Oro Negro failed to revalue its newest rig by an Aug 31 deadline as it tries to lease the asset to state-owned Petroleos Mexicanos by year-end, according to a statement………………………………………..Full Article: Source

Tesco prefers MBK’s $6.6 billion bid for South Korean business

Posted on 03 September 2015 by VRS  |  Email |Print

Tesco has picked private equity firm MBK Partners as preferred bidder to buy its South Korean unit for as much as $6.6 billion, sources said, as the British supermarket retreats from overseas and focuses on revitalising its domestic business. Its bid is backed by Singapore state investor Temasek Holdings and it is seeking funds from South Korea’s National Pension Service (NPS).
The sale of Homeplus, its biggest overseas unit, would be the first large divestment by Tesco boss Dave Lewis. He is seeking to cut debt and lose the firm’s “junk” credit rating status after its profits were battered by an accounting scandal and British market share losses to discounters Aldi and Lidl………………………………………..Full Article: Source

Kazakhstan, China sign 25 deals worth $23 billion

Posted on 02 September 2015 by VRS  |  Email |Print

Kazakhstan and China have signed 25 agreements worth $23 billion, aiming to move cooperation dominated by raw materials to products with greater added value, the official site of the Kazakh president and the state-run wealth fund said on Tuesday.
Kazakhstan’s sovereign wealth fund Samruk-Kazyna issued a statement later, saying it had signed deals worth $5.1 billion with Chinese companies as part of the package of contracts agreed during Nazarbayev’s visit. The deals included transport and energy projects and also covered nuclear, metallurgical and chemical industries, said Samruk, which manages state-owned stakes in branches of the economy………………………………………..Full Article: Source

State General Reserve Fund, Oman Oil Company sign pact to focus on human capital development, SMEs

Posted on 02 September 2015 by VRS  |  Email |Print

The State General Reserve Fund (SGRF), Oman’s sovereign wealth fund and Oman Oil Company (OOC) , the government’s investment arm in the energy sector, have signed a strategic cooperation partnership pact. A press release stated that the pact comes in light of the commitment of both sides to contribute in developing the economy through diversifying the national income and enhancing in-country value (ICV).
The partnership between SGRF and OOC will focus on areas such as the development of human capital, supporting SMEs and knowledge transfer. “This partnership has been established because we at SGRF believe in the importance of cooperation and integration between various investment bodies in the sultanate, to serve the objectives of the fund in building national capacities, localising knowledge and expertise, and enhancing ICV………………………………………..Full Article: Source

Zomato eyes up to $80m in Temasek-led round

Posted on 01 September 2015 by VRS  |  Email |Print

Online restaurant review and food ordering platform Zomato is in advanced stages of talks with Singapore’s Temasek Holdings for raising fresh funds to the tune of $60-80 million, sources told TOI. “The final details of the deal are being worked out,” a person close to the development said.
Zomato will use the fresh funds to enter into food delivery business in India by enabling the last-mile delivery mechanism and to expand its global operations in new geographies such as Europe, South East Asia and Latin America. Part of it would also be utilised to take on Zomato’s biggest competitor in the US — Yelp………………………………………..Full Article: Source

Abu Dhabi fund interested in Woori

Posted on 31 August 2015 by VRS  |  Email |Print

Abu Dhabi’s sovereign wealth fund has shown interest in buying a stake in Woori Bank, Korea’s second-largest lender by assets, the Financial Services Commission (FSC) said. The FSC controls Woori through the state-run Korea Deposit Insurance Corp., which holds a 51 percent stake in the bank.
“The Abu Dhabi Investment Authority (ADIA) said it is interested in buying shares in Woori Bank. The vice chairman will leave for the country soon to meet officials of the fund,” an FSC spokesman said. Another official said that FSC Vice Chairman Jeong Chan-woo also plans to visit Saudi Arabia, Dubai and Kuwait on the one-week trip………………………………………..Full Article: Source

DLF ends flat on possible stake sale to Singapore’s sovereign wealth fund GIC

Posted on 31 August 2015 by VRS  |  Email |Print

Shares of DLF rallied over 3 per cent in trade today as India’s largest real estate developer is close to selling a majority stake in a residential project in New Delhi to Singapore’s sovereign wealth fund GIC, two people aware of the deal said. The share ended the session at Rs 115.05, up 0.52 per cent.
The transaction may be valued at Rs 1,500 crore- Rs 2,000 crore. The 25-acre project in the Moti Nagar area of west Delhi, to be called DLF Capital Greens 6, has secured all approvals and is likely to be launched in the next few months………………………………………..Full Article: Source

Sultanate’s sovereign wealth fund, Oman Oil join hands

Posted on 31 August 2015 by VRS  |  Email |Print

State General Reserve Fund (SGRF), Oman’s sovereign wealth fund, and Oman Oil Company (OOC), the government’s investment arm in the energy sector, have signed a cooperation agreement to build a strategic cooperation partnership.
The announcement of this strategic cooperation came in light of the commitment of both sides to contribute in developing the national economy through diversifying the national income, and enhancing in-country value. The partnership between SGRF and OOC will focus on a number of areas such as the development of human capital, supporting small and medium enterprises (SMEs) and knowledge transfer………………………………………..Full Article: Source

Saudi Arabia can circumvent its challenges

Posted on 31 August 2015 by VRS  |  Email |Print

The SWF (Sovereign Wealth Fund) Institute puts the value the of Saudi Arabia’s sovereign wealth fund at $677 billion, the fourth highest in the world. The June number represents some 9.4 per cent of total SWFs in the world and the second largest within the Gulf after the UAE.
Saudi Arabia continues to enjoy notable credit ratings such as an AA- from Standard & Poor’s and AA from Fitch Ratings, providing a certain level of comfort for institutional investors interested in purchasing Saudi bonds. Nevertheless, both agencies opted to revise the outlook from stable to negative considering the adverse effects from the plunge oil prices and increased government spending. S&P made the move in February while Fitch followed suit this month………………………………………..Full Article: Source

Russian train plans could be derailed as Kremlin withholds $1.8bn from operator

Posted on 28 August 2015 by VRS  |  Email |Print

The Russian government has refused the state rail operator’s request for $1.83bn in funding next year, casting doubt on ambitious rail infrastructure plans. Russian Railways had asked for $1.83bn in 2016 from the federal budget and from Russia’s $75bn oil-revenue-fuelled sovereign wealth fund, the National Wealth Fund, to maintain its financial stability, saying it would otherwise need to raise tariffs by 17.7%.
But the government refused, saying it should look to cut costs instead. Last year Russian Railways, thought to be Russia’s single largest employer, launched a major programme of track refurbishment, with plans to upgrade transport corridors from Asia into Europe along the Trans-Siberian and the Baikal-Amur rail lines………………………………………..Full Article: Source

Temasek joins MBK in bid for Tesco’s South Korea business

Posted on 28 August 2015 by VRS  |  Email |Print

Singapore state investor Temasek Holdings (Private) Ltd has partnered Asia-focused private equity firm MBK Partners to bid for the South Korea arm of British supermarket operator Tesco PLC, two people familiar with the matter told Reuters. MBK has already entered the race for the business, valued at $6 billion. It is vying against Carlyle Group LP and a consortium comprising Affinity Equity Partners and KKR & Co.
Temasek’s latest interest in a consumer-sector deal comes more than a year after it bought almost a quarter of health and beauty retailer A.S. Watson, backed by Hong Kong tycoon Li Ka-shing, for about $5.7 billion in its single biggest investment………………………………………..Full Article: Source

Abu Dhabi firms to rethink deal to cut 1MDB debts, says report

Posted on 27 August 2015 by VRS  |  Email |Print

Abu Dhabi’s International Petroleum Investment Co (Ipic) is considering pulling out of a plan to help restructure 1Malaysia Development Bhd’s debts, Singapore’s Business Times (BT) reported. Citing a source, the paper said Ipic and its subsidiary, Aabar Investment, which signed an agreement last May to help 1MDB cut its debts by RM16 billion, are now having second thoughts about the plan.
BT said it was unclear what led Ipic to rethink the deal, but cited a report in the Gulf Times of “growing unease” in the Middle East in the wake of the 1MDB controversy, including the resignations of Aabar Investments’ chairman Khadem al-Qubaisi and chief executive Mohamed Badawy al-Husseiny………………………………………..Full Article: Source

As deals dry up more Singapore bankers seek exit to sovereign wealth funds

Posted on 26 August 2015 by VRS  |  Email |Print

As deals dry up in Southeast Asia, an increasing number of Singapore-based investment bankers are contacting recruiters about moving to GIC, the Singaporean sovereign wealth fund, or Temasek, the state investment company.
“Over the past six months I’ve seen more banking candidates than ever wanting to join the two asset managers,” says Christina Ng, executive director at LMA Recruitment in Singapore. “These aren’t underperformers either, they’re good-calibre people who could just as well get another job in banking.”……………………………………….Full Article: Source

Sovereign wealth funds: cashing in?

Posted on 26 August 2015 by VRS  |  Email |Print

Sovereign wealth funds offer countries with great natural resources the chance to capitalise on their reserves of wealth and establish diversity and stability in their economies. Global oil prices are making this harder than it used to be.
A number of African states have established sovereign wealth funds (SWF) as a means of managing their revenues. In particular, oil rich states such as Nigeria and Angola have invested a significant amount in their SWFs, with Nigeria’s newly established fund currently standing at USD 1.4 billion and Angola’s Fundo Soberano de Angola (FSDEA) at USD 5 billion………………………………………..Full Article: Source

It’s Often a Curse to Be Blessed With Commodities

Posted on 26 August 2015 by VRS  |  Email |Print

Nowadays the lessons of Indonesia and Norway are widely known. Lots of resource-rich countries and other jurisdictions put commodity earnings aside in sovereign wealth funds. But the temptation of a commodities boom is still hard to resist, especially when it’s the first time.
While it saved slightly less than $500 million in oil revenues in two sovereign wealth funds from 2012 to 2014, the government borrowed approximately $7 billion on international financial markets, at interest rates approximately 5 percent higher than the rate of return on sovereign wealth fund assets. The Ghanaian experience highlights the dangers of over-exuberance when new discoveries are made………………………………………..Full Article: Source

Norway’s ‘oil fund’: Is it making businesses behave better?

Posted on 25 August 2015 by VRS  |  Email |Print

Norway’s sovereign wealth fund has taken a proactive approach to encouraging businesses to improve their practices, and the scale of its holdings could give it a unique ability to influence investors and businesses. Norway, the small Scandinavian nation that boasts of glaciers and mountains and cavernous coastal fjords, says businesses and investors should take ethical and environmental considerations into account, and it’s putting its vast oil resources where its mouth is.
Earlier this week, Norway’s $900 billion sovereign wealth fund, also known colloquially as the “oil fund”, opted to drop four of Asia’s largest companies due to concern over the severe environmental damage caused by Indonesian palm oil plantations……………………………………….Full Article: Source

Norway has a secret weapon to deal with falling oil prices

Posted on 25 August 2015 by VRS  |  Email |Print

The decade-long boom in oil and gas prices is over. Those falling oil prices continue to have major consequences for oil-dependent countries Venezuela and Nigeria. Norway’s sovereign wealth fund is the largest in the world — and its value keeps growing, by virtue of a government policy that limits the government’s usage of the fund to just four percent annually.
The fund, however, could be the biggest loser in Monday’s global stock market selloff — with almost two-thirds of its investments in equities. And with the current dip in oil prices, the government may be inclined to change the policy to allow access to more of the fund’s assets………………………………………..Full Article: Source

Back to School: Norway SWF Offers Internships

Posted on 25 August 2015 by VRS  |  Email |Print

Norges Bank Investment Management (NBIM), which is responsible for the day-to-day running of the Norway Government Pension Fund—Global, has thrown open its Investment Talent Programme 2016. The managers of the world’s largest sovereign wealth fund (SWF) have invited recent graduates to apply to spend two years honing their investment and banking skills. The programme will start in August 2016.
“The programme is targeted at highly motivated and skilled candidates with recent university degrees who are aiming at an international career in investment management,” said the application page on NBIM’s website. “We offer interesting challenges in an active and stimulating international environment. The programme offers excellent possibilities for personal and professional development.”……………………………………….Full Article: Source

Temasek’s Fullerton sees opportunity in Asia market carnage

Posted on 25 August 2015 by VRS  |  Email |Print

During the hour The Australian Financial Review spent with Manraj Sekhon on Monday morning in Sydney, Shanghai’s equity market plunged by 4 per cent, dragging other other Asian markets off a cliff in what would become a savage day of trading across the region. “There is a major growth scare going on,” said Mr Sekhon, the chief executive of Fullerton Fund Management, an Asian-focused asset manager fully owned by Singapore’s sovereign wealth fund, Temasek.
“Markets are paranoid about where growth is coming from. This period will be with us for a while yet – I think the episode we are in is going to get worse before it gets better.” Like other investors in Asian equities, Fullerton’s portfolios were dragged down on Monday, as markets panicked about the growth trajectory for China’s economy after the recent devalution of the renminbi………………………………………..Full Article: Source

Abu Dhabi SWF among anchors in Navkar IPO

Posted on 25 August 2015 by VRS  |  Email |Print

Abu Dhabi Investment Authority, one of the sovereign wealth funds of UAE representing the emirate of Abu Dhabi, is among the anchor investors that have together invested Rs 173 crore in Raigad-based logistics company Navkar Corporation Ltd, as part of an initial public offer (IPO) of the company.
Navkar Corporation, which provides container freight station services and trading activities, allocated 11.6 million equity shares to a total of 15 anchor investors at a share price of Rs 155 equity share. The anchor investors included Morgan Stanley Mauritius Company, Ashburton India Equity Opportunities Ltd, Nomura Singapore, IDFC Fund, HDFC Infrastructure Fund, Franklin India Smaller Companies Fund, Prime India Opportunity Fund and Amundi Funds, among others………………………………………..Full Article: Source

GIC-Backed Microlender Bandhan Starts India Banking Operations

Posted on 24 August 2015 by VRS  |  Email |Print

Bandhan Financial Services Pvt., the first new commercial Indian lender in more than a decade, kicked off operations with 501 branches across the country, with plan for a 26 percent expansion by end-March.
The Kolkata-based company, which counts Singapore’s GIC Pte. and the International Finance Corp. among its investors, is entering India’s mainstream banking industry as the regulator seeks ways to clean up books amid a surge in bad loans and a sputtering economy. Stressed assets are at the highest level since 2002 as four of India’s five biggest banks reported an increase in bad loans for the year ended March………………………………………..Full Article: Source

SWF To Team Up With OTPP, Hermes

Posted on 24 August 2015 by VRS  |  Email |Print

One of the world’s biggest sovereign wealth funds is part of a consortium that is plotting a bid for London City Airport, which has been valued at 2bn, says an article in the Telegraph. Wren House Infrastructure Management, which is an investment vehicle owned by the Kuwait Investment Authority; Canadian giant Ontario Teachers’ Pension Plan; and investment firm Hermes have teamed-up to make an offer for the airport, according to sources in the infrastructure sector. The KIA is the world’s fifth largest sovereign wealth fund with some 592bn in assets.
Oaktree Capital owns the remaining 25pc of the airport and has agreed to the sale. London-based Wren House was set up in 2013 to facilitate direct infrastructure investment by Kuwait’s sovereign wealth fund. Kuwait was part of a consortium that unsuccessfully attempted a 5bn takeover of water utility Severn Trent two years ago. OTPP, which manages about C154.5bn in assets, is one of Canada’s largest investment houses and is a major player in British infrastructure………………………………………..Full Article: Source

Kuwaitis part of $3bn bid to buy London City Airport

Posted on 21 August 2015 by VRS  |  Email |Print

An international consortium of sovereign wealth and pensions funds, including a London-based division of the Kuwait Investment Authority (KIA), is lining up a bid to buy London City Airport for $3 billion, according to media reports.
Wren Infrastructure Management, a London-based division of the KIA, is part of a consortium that is lining up a bid for the airport located in the heart of the English capital. Canadian giant Ontario Teachers’ Pension Plan and investment fund manager Hermes have joined up to lodge a bid for airport, according to a report the Telegraph………………………………………..Full Article: Source

Norwegian oil fund sees losses as US equities drop in value

Posted on 21 August 2015 by VRS  |  Email |Print

Norway’s sovereign wealth fund saw its value decline by NOK53bn (€6bn) over the course of the second quarter, as the kroner strengthened and US equity holdings suffered negative returns.
Yngve Slyngstad, chief executive of Norges Bank Investment Management, in charge of the NOK6.9trn Government Pension Fund Global, said fixed income returns were impacted by a rise in yields across its main markets as he announced overall returns of -0.9%, ahead of its benchmark. Fixed income accounted for over a third of assets at the end of June and returned -2.2%, as only securitised debt seeing a positive return………………………………………..Full Article: Source

Norway Oil Fund: Monetary Policy, China Are Main Issues (Video)

Posted on 20 August 2015 by VRS  |  Email |Print

Monetary policy and China are the biggest issues facing Norway’s sovereign wealth fund, according to Yngve Slyngstad, chief executive officer of the fund. Slyngstad spoke with Bloomberg’s Manus Cranny in Oslo as the world’s biggest sovereign wealth fund, where Norway places most of its oil wealth, lost 73 billion kroner ($8.8 billion) in the second quarter, the first decline in three years, dragged down by falling global bond and stock markets.……………………………………….Full Article: Source

Norway oil fund affirms China commitment

Posted on 20 August 2015 by VRS  |  Email |Print

The world’s largest sovereign wealth fund said it remained committed to China despite expecting more volatility in markets there as the Asian country continues to open up to foreign investors.
Norway’s $870bn oil fund, which owns more than 1 per cent of all global shares, has long been keen to increase its exposure to China to help balance out the dominance of dollar, euro, sterling and yen assets in its portfolio………………………………………..Full Article: Source

Fed, China Hamper Norway’s Sovereign Wealth Fund (Video)

Posted on 20 August 2015 by VRS  |  Email |Print

In today’s “Morning Must Read,” Bloomberg’s Brendan Greeley and Manus Cranny recap the op-ed pieces and analyst notes providing insight behind today’s headlines, including comments from the Chief Executive Officer of the Norway Sovereign Wealth Fund. They speak on “Bloomberg Surveillance.”.………………………………………Full Article: Source

The Better Corporation

Posted on 20 August 2015 by VRS  |  Email |Print

Around the world, the corporate governance landscape is shifting, as efforts to improve business practices and policies gain support and momentum. The wave of reform has become visible everywhere – from tough new regulations in Japan to sovereign wealth funds like Norway’s Norges Bank Investment Management taking a more active approach to their investments – and it is certain to continue to rise.
Three factors are driving these developments. First, today’s deep economic uncertainty has broadened ordinary people’s awareness of the influence that companies have on politics, policy, and their own daily lives. And, as I have noted previously, people are not only paying greater attention; they also have more power than ever before to make their voices heard………………………………………..Full Article: Source

London City Airport could be bought by world’s fifth biggest sovereign wealth fund

Posted on 20 August 2015 by VRS  |  Email |Print

London City Airport could be bought by one of the world’s biggest sovereign wealth funds. Reports in The Telegraph suggest the Docklands site - valued at £2billion - could be snapped up by Wren House Infrastructure Management, an investment vehicle owned by Kuwait Investment Authority.
For the bid they are said to be teaming up with Canadian giant Ontario Teachers’ Pension Plan and investment firm Hermes. Boasting $592billion (£377billion) in assets, the KIA is the world’s fifth largest sovereign wealth fund………………………………………..Full Article: Source

China’s sovereign wealth fund is betting big on a stock market recovery

Posted on 20 August 2015 by VRS  |  Email |Print

According to a report in the South China Morning post, Central Huijin Investment, a Chinese state-backed subsidiary of the China Investment Corporation, used more than 20 billion yuan ($3.125 billion) to increase its stake in Chinese banks during Wednesday’s trading session. The China Investment Corporation, or CIC, is China’s sovereign wealth fund.
Bank of China, Industrial and Commercial Bank of China, China Construction Bank, Agricultural Bank of China, China Everbright Bank, and state-owned New China Life Insurance notified the Hong Kong stock exchange on Wednesday evening that Central Huijin increased its stake in their A-shares through transfer agreements, said the report………………………………………..Full Article: Source

BNY Mellon Fined for Bribing SWF with Internships

Posted on 20 August 2015 by VRS  |  Email |Print

BNY Mellon has agreed to pay $14.8 million to settle corruption charges for giving internships to family members of a Middle Eastern sovereign wealth fund’s officials. The US Securities and Exchange Commission (SEC) found that the custodian bank and asset manager employed three of these family members in 2010 despite them not meeting “stringent hiring standards” of a minimum grade point average and multiple interviews.
“BNY Mellon viewed the internships as important to keep the sovereign wealth fund’s business,” the SEC said. The unnamed sovereign fund had been BNY Mellon’s customer since 2000 and held about $55 billion with the bank………………………………………..Full Article: Source

Korean Sovereign Fund Asks Elliott to Stop Investing in Korea

Posted on 19 August 2015 by VRS  |  Email |Print

South Korea’s sovereign wealth fund has asked Elliott Management Corp. to refrain from investing in Korean-based businesses after the activist hedge fund firm lost a high-profile proxy fight last month aimed at blocking a merger of businesses partly owned by the Samsung conglomerate’s controlling Lee family, said a person with direct knowledge of the matter.
The request was made in accordance with the Korean law that allows Korea Investment Corp. to invest in non-Korean businesses only, the person said. The 2005 law, the Korea Investment Corporation Act, mandated creation of the sovereign fund to invest in overseas assets. The fund’s assets now are worth more than $85 billion………………………………………..Full Article: Source

Kuwait eyes consortium bid for London City Airport

Posted on 19 August 2015 by VRS  |  Email |Print

The sovereign wealth fund of Kuwait is teaming up with Ontario Teachers’ Pension Plan and Hermes to bid for the airport, while Macquarie is leading a rival consortium. One of the world’s biggest sovereign wealth funds is part of a consortium that is plotting a bid for London City Airport, which has been valued at £2bn.
Wren House Infrastructure Management, which is an investment vehicle owned by the Kuwait Investment Authority; Canadian giant Ontario Teachers’ Pension Plan; and investment firm Hermes have teamed-up to make an offer for the airport, according to sources in the infrastructure sector. The KIA is the world’s fifth largest sovereign wealth fund with some $592bn in assets………………………………………..Full Article: Source

Kuwait sovereign credit ratings affirmed despite low oil prices

Posted on 19 August 2015 by VRS  |  Email |Print

Standard & Poor’s Ratings Services affirmed its ‘AA/A-1′ long- and short-term foreign and local currency sovereign credit ratings on Kuwait. The outlook is stable. Prices for crude oil have fallen by around 50% in the last year. We now forecast an average Brent oil price of 55/bbl in 2015 and 67.5/bbl in 2015-2018. The sharp fall in oil prices over the past year has significantly affected Kuwait’s fiscal and current account (flow) positions.
Nevertheless, our ratings on Kuwait remain unchanged as they continue to be supported by the sovereign’s high levels of accumulated wealth and very strong external and fiscal asset (stock) positions the Kuwaiti government, via the Kuwait Investment Authority (KIA), has accumulated substantial assets through oil and gas production over the years, saving its oil wealth in what we consider to be a prudent manner………………………………………..Full Article: Source

Canada’s natural-resource wealth must be included on balance sheets

Posted on 19 August 2015 by VRS  |  Email |Print

The amount of natural-resource wealth within Canada’s borders is impressive. Natural-resource assets, which include timber, oil, natural gas and other subsoil minerals, have been valued by Statistics Canada at about $1-trillion. This puts Canada in an enviable position relative to other countries.
Similar reasoning is reflected in Norway’s leverage of its natural-resource wealth, largely from oil and gas revenue, into $1.1-trillion in investments through its sovereign wealth fund. Compare that with Alberta’s Heritage Fund portfolio of just $17.9-billion………………………………………..Full Article: Source

Greenko to sell Indian assets to Singapore wealth fund GIC

Posted on 18 August 2015 by VRS  |  Email |Print

Renewable energy firm Greenko Group has agreed to sell its Indian assets and trading activities to Singapore sovereign wealth fund GIC for £162.8m. The parties have signed non-binding heads of terms, which will see Greenko divest its shares in Greenko Mauritius.
The transaction, which includes the rights to several clean energy projects in India, would releive Greenko from all related financial liabilities. Greenko and GIC are currently in an advanced stage of negotiations. The disposal will be subject to a legally binding agreement. Greenko aims to distribute the proceeds from the sale, net of certain Indian taxation, transaction fees and running costs, to its own shareholders………………………………………..Full Article: Source

Oil decline re-emphasises GCC SWFs’ diversification

Posted on 18 August 2015 by VRS  |  Email |Print

GCC Sovereign wealth funds, or SWFs have become the primary state-sponsored financial vehicles for managing national wealth, focusing on investments with higher potential returns. GCC SWFs have accumulated close to $2.67 trillion at the start of 2015 and constitute more than 37 per cent of Global SWFs.
UAE SWF is more than $1.07 trillion, $763 billion by Saudi Arabia, $548 billion by Kuwait and $256 billion held by Qatar. Oman and Bahrain maintain $19 billion and $11 billion respectively. Saudi Arabia has traditionally managed the country’s investment of oil surpluses abroad, focusing on low-risk assets such as US treasuries, however has started diversifying in other segments as well. In July 2015 Saudi Arabia’s Public Investment Fund, or PIF, agreed to invest $10 billion over the next five years approximately in the Russia Direct Investment Fund, or RDIF, a government-run investment fund………………………………………..Full Article: Source

Alberta and Norway: Two oil powers, worlds apart

Posted on 17 August 2015 by VRS  |  Email |Print

As world oil production outstrips demand, China’s outlook darkens and prices plumb levels not seen since the Great Recession, energy-exporting countries around the world face a prolonged period of thinner revenues and deepening economic woes. The Alberta Heritage Savings Trust Fund, the province’s rainy-day umbrella, barely has enough capital to deal with a few scattered storms. Norway’s equivalent, which was partly modelled on Alberta’s when it was set up in the early 1990s, could handle a deluge of almost biblical proportions.
Consider the fortune amassed by Norway’s prosperity fund. Norway’s petroleum treasure chest holds assets totalling some seven trillion kroner ($1.1-trillion), making it the world’s largest sovereign wealth fund. It’s a potential shock absorber of a size and scope not available to any other energy producer outside the Arabian Peninsula……………………………………….Full Article: Source

U.K. Wealth Fund to Target Private Equity, Infrastructure Investment

Posted on 17 August 2015 by VRS  |  Email |Print

London Mayor Boris Johnson’s fledgling British sovereign-wealth fund plans to combine local public pension funds and invest billions of pounds in private equity and infrastructure projects. The plan to develop a so-called citizens’ wealth fund with more than $100 billion is being led by Edmund Truell, a private equity investor and chairman of the London Pensions Fund Authority.
The London Pensions Fund Authority and the Greater Manchester Pension Fund joined forces in January to create a £500 million ($780 million) infrastructure fund. In December, the London fund agreed a separate £10 billion partnership with the Lancashire County Pension Fund……………………………………….Full Article: Source

Modi Eyes Gulf Billions in Rare Visit by Indian Leader

Posted on 14 August 2015 by VRS  |  Email |Print

Narendra Modi heads to the United Arab Emirates in the coming week to seek cash from the world’s second-richest sovereign wealth fund for everything from trains to toilets. Modi will be the first Indian prime minister in more than 30 years to visit the U.A.E., India’s third-biggest trade partner. The two-day visit will feature discussions that will probably refer to the sovereign wealth fund, according to Indian Foreign Ministry spokesman Vikas Swarup.
“I seek to enhance cooperation in energy, trade and will talk to investors on why India is an attractive destination,” Modi wrote on Facebook on Thursday. The Abu Dhabi Investment Authority’s $773 billion in assets is second only to those of Norway. Modi is scheduled to meet Sheikh Mohamed bin Zayed Al Nahyan, Abu Dhabi’s Crown Prince who chairs the Abu Dhabi Investment Council, an offshoot of the sovereign wealth fund………………………………………..Full Article: Source

Modi visit: UAE’s $800 bn sovereign wealth fund likely in talks

Posted on 14 August 2015 by VRS  |  Email |Print

A key focus area of talks during Prime Minister Narendra Modi’s visit to the UAE on August 16-17 is expected to be the Gulf country’s estimated $800 billion sovereign wealth fund that India will seek to tap for infrastructure projects. The Abu Dhabi Investment Authority (ADIA) sovereign wealth fund is said to be the world’s second largest sovereign wealth fund. It is believed to be one of the investors in HDFC’s $1-billion offshore fund to finance affordable housing projects in India.
Modi’s visit comes as the UAE has appointed Ahmad Sultan Al Falahi as the new trade attache at the United Arab Emirates embassy in New Delhi. Modi’s visit, the first by an Indian prime minister to the UAE in 34 years and his first to an Arab nation, has “been in the works for some time”………………………………………..Full Article: Source

Surge in European M&A shows SWF firepower

Posted on 13 August 2015 by VRS  |  Email |Print

European takeover activity involving sovereign wealth funds more than tripled in the first half of 2015, amid signs that such funds’ greater firepower may be pushing up deal valuations. The 16 acquisitions by sovereign wealth funds in Europe in the first half of the year were worth an aggregate €13.9 billion, according to data provider Mergermarket, compared with a combined €3.4 billion across 15 deals in the same period last year.
Some of the world’s largest sovereign funds – including Government of Singapore Investment Corp and the Abu Dhabi Investment Authority – were part of a consortium in May that agreed to buy a 32.98% stake in telecommunications company Hutchison 3G UK for €4.2 billion – the largest private equity deal in Europe in the first six months of the year………………………………………..Full Article: Source

Modi visit: UAE’s USD 800 bn sovereign wealth fund likely in talks

Posted on 13 August 2015 by VRS  |  Email |Print

A key focus area of talks during Prime Minister Narendra Modi’s visit to the UAE on August 16-17 is expected to be the Gulf country’s estimated $800 billion sovereign wealth fund that India will seek to tap for infrastructure projects.
The Abu Dhabi Investment Authority (ADIA) sovereign wealth fund is said to be the world’s second largest sovereign wealth fund. It is believed to be one of the investors in HDFC’s $1-billion offshore fund to finance affordable housing projects in India. Modi’s visit comes as the UAE has appointed Ahmad Sultan Al Falahi as the new trade attache at the United Arab Emirates embassy in New Delhi………………………………………..Full Article: Source

Indian PM Narendra Modi eyes UAE’s $800 billion sovereign fund to boost infrastructure spending

Posted on 13 August 2015 by VRS  |  Email |Print

Narendra Modi, whose foreign visits over the past year was aimed at attracting much needed foreign investment to boost the economy, would try to lure a share from $800-billion sovereign fund of the UAE for infrastructural needs as well as give momentum to Bilateral Investment Protection Agreements (BIPA) that has not functioned to its potential to attract investments.
Buoyed by the oil economy, UAE sovereign wealth fund is estimated at over $800 billion and Modi would like to attract part of this fund, imperative for the country’s infrastructural needs estimated at one trillion dollars, officials hinted. The Abu Dhabi Investment Authority (ADIA) is the sovereign wealth fund owned by Emirate of Abu Dhabi (in the UAE) founded for the purpose of investing funds on behalf of the Government of the Emirate of Abu Dhabi………………………………………..Full Article: Source

Top wealth fund says half its stock trades now outside exchanges

Posted on 13 August 2015 by VRS  |  Email |Print

Up to half of all shares traded by the world’s largest sovereign wealth fund are bought and sold outside of stock markets in a bid to cut transaction costs, a fivefold rise since 2010, a senior executive at Norges Bank Investment Management (NBIM) said.
The manager of Norway’s $873 billion oil fund is gradually moving away from automated trading in favor of a measured approach that even includes the services of stockbrokers, Chief Investment Officer for Asset Strategies Oyvind Schanke said. In a recent report, NBIM argued that global stock exchanges are failing to meet the needs of large institutional investors as the race towards ever faster buying and selling is both unnecessary and costly, benefiting only high-frequency traders………………………………………..Full Article: Source

Norway’s Sovereign Wealth Fund Pinched by Cheap Oil (Video)

Posted on 13 August 2015 by VRS  |  Email |Print

In today’s “Single Best Chart,” Bloomberg’s Brendan Greeley displays how the decline in oil revenues in Norway is impacting the nation’s budget and sovereign wealth fund investments. He speaks on “Bloomberg Surveillance.”.………………………………………Full Article: Source

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