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Permanent Fund debated as source of state cash for investment in gas export project

Posted on 08 October 2014 by VRS  |  Email |Print

Alaska may have an opportunity for a potentially risky but very profitable investment when it comes to decision time on a liquefied natural gas export project. But budget deficits are eating into Alaska’s readily available savings, and there may not be much other than the Alaska Permanent Fund left when it comes time to make those multibillion-dollar investments.
So should the Permanent Fund consider investing some of its $50 billion portfolio in a pipeline project?……………………………………….Full Article: Source

Norway to Tap Record Amount of Oil Money for Budget, DNB Says

Posted on 07 October 2014 by VRS  |  Email |Print

Norway, Scandinavia’s richest nation, will use a record 169 billion kroner ($26 billion) of its sovereign wealth fund to plug budget gaps as an oil boom fades, the country’s biggest bank said. “We expect that 2015 will be a rather poor year by Norwegian standards — not a crisis, but lower growth than usual,” Kjersti Haugland, an analyst at DNB ASA, said in an interview. “It wouldn’t be seen as inappropriate to have an expansionary budget.”
The minority government will use 3 percent of the wealth fund, or about 6.6 percent of gross domestic product, Haugland said. In its May revised budget, it proposed to this year use 140.9 billion kroner, or 2.8 percent of the fund, equal to 5.8 percent of so-called trend GDP………………………………………..Full Article: Source

Norway Would Probably Pay to Keep Stake After Yara-CF Tie

Posted on 06 October 2014 by VRS  |  Email |Print

Norway would probably spend billions of dollars to maintain its stake in Yara International ASA (YAR) if a merger being discussed occurs with CF Industries Holdings Inc., parties representing a majority of Norway’s parliament said. “That’s totally unproblematic,” Oeyvind Korsberg, the Progress Party spokesman for trade, said. “The state is overflowing with money, we’re injecting money in businesses abroad through our sovereign wealth fund. So access to capital is the least of our problems.”
The Norwegian state owns about a third of the shares listed on the Oslo stock exchange, and has also built an $850 billion sovereign wealth fund, the world’s biggest, from taxes and interests in oil and gas production………………………………………..Full Article: Source

PFD Corporation makes 2014 gains

Posted on 06 October 2014 by VRS  |  Email |Print

The Alaska Permanent Fund Corporation returned 15.5 percent during fiscal year 2014, according to a review last week at its annual meeting in Juneau. The fund’s investments earned $6.8 billion, the highest amount in its 37-year history, and ended the year with a value of $51.2 billion.
The Board of Trustees also re-elected Bill Moran as chairman and Carl Brady as vice-chairman………………………………………..Full Article: Source

Qatar loses more than £1.5bn on Sainsbury’s

Posted on 06 October 2014 by VRS  |  Email |Print

Qatar is sitting on estimated losses of more than £1.5bn from its investment in J Sainsbury after a downbeat trading update from the supermarket retailer sparked a slide in its shares. Calculations by The Telegraph show that the slump in the company’s share price means Qatar Holding, the sovereign wealth fund, is sitting on paper losses of more than £1.5bn. Qatar Holding first bought into Sainsbury’s in 2007 and owns 26pc of the retailer.
Sainsbury’s share price has never regained the highs it enjoyed in 2007 before the credit crisis began. Qatar’s shareholding has been the subject of much speculation in the City about whether the sovereign wealth fund will dump the stake or launch a full takeover bid………………………………………..Full Article: Source

Declining govt revenue digs hole in Excess Crude Account

Posted on 06 October 2014 by VRS  |  Email |Print

Although Nigeria’s Ex­cess Crude Account was created in 2004 to act as a buffer against anticipated shortfalls in Fed­eral Government revenue from oil and other income sources, recent trend in its growth trajectory appears to be unsettling stakeholders in the economy.
For one, those who are at home with the dynamics of the nation’s economic man­agement are rather agitated that the persistent drawdown by government to augment its stock of distributable monthly revenue clearly shows that it may be difficult for the objectives of the ECA to be realized in the long run………………………………………..Full Article: Source

Oil wealth dividends distributed to most Alaskans

Posted on 03 October 2014 by VRS  |  Email |Print

Most Alaskans will receive $1,884 checks Thursday as this year’s share of the state’s oil wealth that’s distributed annually just for living here. The payout from the Alaska Permanent Fund this year is more than double the amount of the $900 dividends distributed in 2013, but short of the record payout of $2,069 in 2008.
The amount of each person’s check is based on a five-year average of the fund’s investment earnings, which have included the recession years. Alaska wasn’t hit as hard by the recession as the Lower 48, but the Permanent Fund Corp. has a diversified portfolio that was clobbered when markets plunged worldwide………………………………………..Full Article: Source

State to pay $70 million toward Alabama Trust Fund debt as fiscal year ends

Posted on 03 October 2014 by VRS  |  Email |Print

The state has taken another step toward repaying money it borrowed to prop up the education budget during the recession. Gov. Robert Bentley announced today the state will repay $70 million to the Alabama Trust Fund out of funds from fiscal year 2014, which ended Tuesday.
That includes $35 million that was required under the budget passed by the Legislature, plus another $35 million that was conditional on the funds being available. The state borrowed $437 million from the Alabama Trust Fund in fiscal year 2009 to support the education budget and must finish repaying the money next year………………………………………..Full Article: Source

Brazil official rules out fire sale of Banco do Brasil stock

Posted on 02 October 2014 by VRS  |  Email |Print

Brazil’s government has no plans to sell the shares of state-run Banco do Brasil SA owned by the nation’s sovereign wealth fund, to help close a shortfall in the federal budget, a top finance ministry official said on Wednesday.
The government has no intention of carrying out a fire-sale of the shares which would “unnecessarily slash” their value, said Paulo Rogêrio Caffarelli, the ministry’s No. 2 official, at an event in Rio de Janeiro………………………………………..Full Article: Source

Daimler : KIA looks to build on $18bn German spend

Posted on 02 October 2014 by VRS  |  Email |Print

The Kuwait Investment Authority (KIA), one of the world’s largest sovereign wealth funds and a long-term investor in German auto maker Daimler AG, wants to ramp up investments in Europe’s largest economy.
Finance minister and KIA board chairman Anas al Saleh said the authority would add to its investments in Germany, where Kuwait has invested almost $18 billion. KIA is the largest shareholder in Daimler, with a 6.8 per cent stake. The stake has grown in value to almost $6 billion………………………………………..Full Article: Source

CIC cuts stake in Noble Group

Posted on 01 October 2014 by VRS  |  Email |Print

China Investment Corp sold part of its stake in Noble Group, sending shares in the commodity trader tumbling and sparking fears the mainland sovereign wealth fund will eventually move to offload most of its holding. CIC, the second-biggest shareholder, sold shares equivalent to 4.5 per cent of the commodity trader.
The shares were sold at S$1.32 (HK$8.04), the bottom of an indicative range that topped out at S$1.35, raising S$396 million. It was not clear why CIC was selling the stake, but Nathan Gee, an analyst at Bank of America Merrill Lynch, said he did not expect any damage to Noble’s strategic relationships on the mainland………………………………………..Full Article: Source

CIC selling part of Noble Group stake, fans fear of more sales

Posted on 01 October 2014 by VRS  |  Email |Print

China Investment Corp will sell part of its stake in Noble Group Ltd at a 5 percent discount, sending shares in the commodity trader tumbling and sparking fears that CIC would eventually move to offload most of its holding.
The Chinese sovereign wealth fund, Noble’s second biggest shareholder, is selling shares equivalent to 4.5 percent of the commodity trader, a term sheet showed………………………………………..Full Article: Source

Indonesia’s Bumi Resources cuts rights issue size, in talks with creditors

Posted on 30 September 2014 by VRS  |  Email |Print

PT Bumi Resources Tbk , Indonesia’s biggest coal miner, has cut its planned rights issue, saying it sees an opportunity to negotiate with some creditors on its debt. In June, Bumi said it will issue up to 32.2 billion shares to raise 8.05 trillion rupiah ($664 million), mainly to pay off its debt to creditors, including Chinese sovereign wealth fund China Investment Corp.
In October last year, CIC agreed to convert part of Bumi’s debt into stakes in the miner and associated subsidiaries. In July, Bumi transferred a 19 percent stake worth $950 million in its unit, Kaltim Prima Coal, cutting its debt to the Chinese sovereign wealth fund to $1.04 billion………………………………………..Full Article: Source

Fitch expects further moderate growth of Azerbaijan’s sovereign assets

Posted on 30 September 2014 by VRS  |  Email |Print

Azerbaijan’s sovereign balance sheet is one of the strongest of any rated sovereign and underpins the rating, the statement says. The State Oil Fund of Azerbaijan (SOFAZ) reached USD37.6bn in 1H14. Adding USD15bn in foreign-exchange reserves at the Central Bank of Azerbaijan (CBAR), the sovereign’s gross external assets are equivalent to 69% of GDP.
Fitch expects further modest growth in sovereign assets as the current account registers (diminishing) surpluses in 2014-16. This should provide a buffer against oil price or production shocks and support the manat’s (AZN) peg to the USD at AZN0.78/USD1………………………………………..Full Article: Source

Reformed Irish SWF could still be used to pre-fund pension liabilities

Posted on 30 September 2014 by VRS  |  Email |Print

Using the Ireland Strategic Investment Fund’s (ISIF) assets to pre-fund the country’s pension liabilities should not be ruled out, the head of the Irish debt management office has said.
John Corrigan, outgoing chief executive at the National Treasury Management Agency (NTMA), said pension provision remained on the government agenda, despite last year’s decision to transform the National Pensions Reserve Fund (NPRF) into the ISIF, severing its ties with the pre-funding of state pension liabilities………………………………………..Full Article: Source

Aabar wealth fund to work with Goldman Sachs on options for RHB stake

Posted on 29 September 2014 by VRS  |  Email |Print

Aabar Investments PJSC, owned by Abu Dhabi’s sovereign wealth fund, is working with Goldman Sachs Group Inc. as it explores options for its stake in RHB Capital Bhd., according to people with knowledge of the matter.
Aabar, the Malaysian bank’s second-largest shareholder with a 21.2 per cent stake, is seeking to protect the value of its investment as the lender negotiates a three-way merger with CIMB Group Holdings Bhd. and Malaysia Building Society Bhd., the people said. It hasn’t yet signed a formal mandate with Goldman Sachs, one person said, asking not to be identified as the talks are private………………………………………..Full Article: Source

Ai to boost African pension, sovereign wealth fund by $1 trn

Posted on 29 September 2014 by VRS  |  Email |Print

Africa Investor, Ai has announced its $1billion Africa investor Sovereign Infrastructure Investment Platform, for African pension and sovereign wealth funds – continually developed in close partnership with African pension and sovereign wealth funds.According to a statement after the summit, Ai , a leading international investment and communications group and US institutional investors, including sovereign wealth and pension funds, have agreed to invest in Africa’s fastest growing sectors and capital markets.
The new Ai platform is uniquely designed to increase intra-African investment, which is currently at a mere 5 per cent compared to intra-European investment levels in excess of 70 per cent………………………………………..Full Article: Source

2014 Permanent Fund check set at $1,884

Posted on 26 September 2014 by VRS  |  Email |Print

Gov. Sean Parnell today announced that the 2014 Permanent Fund Dividend will be $1,884. The first dividends will be paid on Oct. 2, when approximately 510,731 applicants will receive a direct deposit into their bank account, and 88,186 will be mailed a check. Paper checks will enter the U.S. mail system on Oct. 2 from Juneau.
674,538 Alaskans applied for the 2014 dividend this year – an increase of approximately 1,587 applications from 2013. More than $944.4 million will be directly deposited into Alaskans’ bank accounts this year, with a total distribution, including checks, of $1.1 billion. Beginning Oct. 2, and continuing monthly thereafter, applications that become eligible will be paid either by check or direct deposit………………………………………..Full Article: Source

Ireland’s new SWF will take ‘years’ to deploy capital fully, says NTMA head

Posted on 25 September 2014 by VRS  |  Email |Print

The Ireland Strategic Investment Fund (ISIF) will take up to four years to re-deploy its €7bn in assets, according to the head of the National Treasury Management Agency (NTMA).
John Corrigan, who is to retire as chief executive of the NTMA at the end of December, also said the organisation’s chairman Willie Walsh would soon start recruiting members of the ISIF investment committee………………………………………..Full Article: Source

SOFAZ to gain $200 bln in coming years

Posted on 24 September 2014 by VRS  |  Email |Print

Azerbaijan’s state oil fund SOFAZ, an entity that accumulates and manages the country’s oil and gas revenues, is expected to gain $200 billion in the coming years.The news was announced by Executive Director of SOFAZ Shahmar Movsumov on September 20.
He told the journalists that currently, SOFAZ continues financing the projects on the construction of the Baku-Tbilisi-Kars railway, rehabilitation of the Samur-Absheron irrigation system, as well as the state program on education of Azerbaijani students abroad………………………………………..Full Article: Source

2014 Looks to Beat 2013 in Sovereign Wealth Fund Transactions

Posted on 24 September 2014 by VRS  |  Email |Print

Increasingly, sovereign wealth funds are investing directly. The larger sovereign funds are getting involved in more deals, whether in institutional real estate, partaking as a group member in a company acquisition or buying more shares on the open market.
As a whole, the world of sovereign wealth funds is rapidly expanding due to numerous factors. One significant factor is the number of new sovereign wealth funds cropping up, particularly in Africa and the Americas……………………………………….Full Article: Source

Brazil: Government draws US$ 1.7 bn from sovereign fund

Posted on 23 September 2014 by VRS  |  Email |Print

The non-fulfilment of tax collection growth forecasts has driven the Brazilian government to draw R$ 3.5 billion (US$ 1.7 billion) from Fundo Soberano do Brasil (FSB – the Sovereign Fund of Brazil) to prevent a new cut in non-discretionary (non-mandatory) expenditures. The decision was made public in the Revenues and Expenses Assessment Report released every two months by the Ministry of Planning, which allocates the General Federal Budget. The information was released by government news agency Agência Brasil.
The Sovereign Fund was established using leftover cash from the primary surplus – funds saved for paying interest on the public debt – accrued in 2008. The savings worked as a fallback, in case the government required additional funds for settling public accounts. By late 2012, the National Treasury had drawn R$ 12 billion (US$ 5 billion) to meet the year’s primary surplus target………………………………………..Full Article: Source

Each Alaskan to receive $1,900 from oil fund

Posted on 22 September 2014 by VRS  |  Email |Print

It’s a highly anticipated day of the year in Alaska, when residents learn how much money they’ll receive from the state’s oil wealth savings account — a payout people receive just for living in The Last Frontier. This year’s share of nearly $1,900 is the sweetest since the Great Recession and the third-richest ever.
Gov. Sean Parnell announced the amount of the Alaska Permanent Fund Dividend with great fanfare Wednesday. “This is all good news for Alaskans,” he said at an Anchorage press conference. The payout to be distributed Oct. 2 is more than double the amount of last year’s $900 checks but short of the record payout of $2,069 in 2008………………………………………..Full Article: Source

Kazakh Wealth Fund to Sell Ukrainian Assets as Risks Grow

Posted on 19 September 2014 by VRS  |  Email |Print

Kazakhstan is speeding up the sale of its assets in Ukraine as growing “political risks” threaten outside investors, sovereign wealth fund Samruk-Kazyna said. “Given the current political and economic situation in Ukraine, the interests of non-residents will be considered last,” Samruk-Kazyna Deputy Chief executive Officer Yelena Bakhmutova said on the fund’s website.
The fund plans to sell its shares in Kherson Oil Refinery, Ukrnefteproduct and Kazakhoil-Ukraina, she said. In 2000, Kazakhoil, a state-owned oil company that was later merged into KazMunaiGaz National Co., won a tender to purchase 60 percent of the refinery for about $6.4 million. The plant has been shut since 2005. Samruk-Kazyna is the parent company of KazMunaiGaz……………………………………..Full Article: Source

Finance Minister: Russia’s Draft 2015 Budget Envisages No Sales Tax

Posted on 19 September 2014 by VRS  |  Email |Print

The Russian government does not plan to make any cash injections into the country’s Reserve Fund next year. It is predicted that by the end of 2015, the Reserve Fund will amount to 3.543 trillion rubles ($92 billion), while the Russian National Wealth Fund (NWF), which is part of the Reserve Fund, is expected to reach 3.194 trillion rubles ($83 billion).
The Russian non-oil and gas budget deficit will amount to 10.5 percent of the country’s GDP……………………………………..Full Article: Source

Mubadala units drive revenue growth during first half

Posted on 19 September 2014 by VRS  |  Email |Print

Mubadala Development, the strategic investment vehicle owned by the Abu Dhabi Government, said revenue and operating income rose in the first half of the year, mainly because of higher sales and income from its aerospace, energy and aluminium businesses.
Under the terms of the restructuring, Mubadala is due to have the full amount repaid by 2017. An executive at the company declined to comment on the Brazilian situation, but pointed to the fact that EBX had recently received $800m in cash from the sale of a 49 per cent stake in its Colombian gold business to the Qatar Investment Authority……………………………………..Full Article: Source

Mubadala’s first-half profit up 23% on higher JV income

Posted on 19 September 2014 by VRS  |  Email |Print

Mubadala Development Company, the Abu Dhabi-owned sovereign wealth fund, on Thursday posted a 23 per cent profit jump for the first half of the year. The company tasked with developing the emirate’s economy posted a Dh1.34 billion ($364.8 million) profit attributable to equity owners compared to the Dh1.09 billion profit it accrued in the same period a year ago.
Mubadala’s 23 per cent profit jump is off the back of higher revenues from joint ventures such as Emirates Global Aluminium and Dolphin Energy. Income from the joint venture business doubled to Dh2.12 billion in the six months ending June 30……………………………………..Full Article: Source

BTK railway to be commissioned in 2015

Posted on 18 September 2014 by VRS  |  Email |Print

All the technical work on the creation of railway lines to the Georgian-Turkish border will be completed before the end of September within the framework of the project of the Baku-Tbilisi-Kars railway construction, Deputy Transport Minister Musa Panahov told reporters Sept.17.
Azerbaijan has allocated a loan worth $775 million for construction of the railway’s Georgian section. Azerbaijan’s State Oil Fund (SOFAZ) carries out the funding of the project in accordance with the decree of Azerbaijani president ‘On the implementation of the project activities of the Baku-Tbilisi-Kars’ dated February 21, 2007……………………………………Full Article: Source

No energy $$ deposited in Heritage Fund for 2014

Posted on 12 September 2014 by VRS  |  Email |Print

No money from the energy sector was deposited in the Heritage and Stabilisation Fund during fiscal 2014 because oil revenues fell, Finance Minister Larry Howai has said. In 2013, $271 million was transferred to the Fund which was established as a “rainy day” financial relief mechanism if the country becomes economically constrained.
The net asset value of the Fund as at June 30, 2014 stands at US$5.56 billion, up from US$5.15 billion in 2013. The positive performance of the Fund was due solely to gains from the investment portfolio of the Fund as no deposits were recorded for the period, the Review of the Economy 2014 budget document states………………………………………..Full Article: Source

1MDB is national debt, not surplus, says Dr M

Posted on 11 September 2014 by VRS  |  Email |Print

Former prime minister Mahathir Mohamad has disputed Salleh Said Keruak’s recent statement describing 1MDB as an education fund. In true Mahathir fashion, he quipped he wasn’t at all aware of any use of the funds from 1MDB for education.
“There are advertisements that claim over one million of the rakyat have been helped using funds from 1MDB. If you divide one million over four years, that’s 250,000 people a year. If it’s true, Alhamdulillah.“From what I know, funds from 1MDB were used to procure three power plants from YTL, Ananda Krishnan and the proprietor of Jimah power plant in Negeri Sembilan. The acquisition was more expensive than the market price. At least four billion ringgit in total cost,” he said in his blog………………………………………..Full Article: Source

Dr M raises eyebrow at 1MDB’s debt buildup

Posted on 11 September 2014 by VRS  |  Email |Print

Tun Dr Mahathir Mohamad has expressed concern over the debt being amassed by sovereign wealth fund 1MDB, warning that this could overwhelm Putrajaya’s already strained finances. The former prime minister also questioned why Malaysia needed a state investment fund such as the 1MDB, pointing out that these were usually formed by countries with a surfeit of wealth and revenue, rather than one heavily in debt.
“Funds for 1MDB are not from the country’s surpluses. These are debts. Billions of ringgit owed will add to the country’s very high debts. Debts that the country must pay………………………………………..Full Article: Source

MAS needs harder reset to get out of tailspin

Posted on 11 September 2014 by VRS  |  Email |Print

The figures from what Khazanah Nasional called a “hard reset” of beleaguered flag carrier Malaysia Airlines (MAS) certainly sounded impressive - it would slash 6,000 jobs and pump in RM6 billion (S$2.4 billion). But the sovereign wealth fund’s rescue plan for an airline that has lost RM5 billion since 2011 is not quite as bold as it seems in this age of the sound bite.
There is nothing ingenious about the idea of dumping money into a business to continue operations - even one that loses more than RM1 million a day from just financing costs alone - or of “right-sizing” the headcount by a third, when you have only 60 per cent of neighbouring Singapore Airlines’ efficiency………………………………………..Full Article: Source

Temasek exchanges on GBP175mln City buy

Posted on 11 September 2014 by VRS  |  Email |Print

Temasek Holdings, a sovereign wealth fund owned by the Government of Singapore, has exchanged contracts on its purchase of a 50% stake in MidCity Place, heralding its debut purchase outside of Asia. Temasek has paid Beacon Capital Partners, advised by Eastdil Secured, just over £175m for the half share in the 336,901 sq ft EC1 office trophy, a deal first revealed by CoStar News last month.
The deal was secured following a close run bidding war against other sovereign wealth funds drawn to the quality of the asset and the opportunity to share the ownership of the building with Oxford Properties, which owns the other 50% interest………………………………………..Full Article: Source

CIC’s investment in Alibaba quadruples in two years

Posted on 10 September 2014 by VRS  |  Email |Print

China Investment Corporation (CIC), which invested in e-commerce giant Alibaba two years ago, has quadrupled the value of its investment, reports our Chinese-language sister paper China Times.
The sovereign wealth fund’s shares in Alibaba are estimated at US$5 billion and the Hangzhou-based company has been a much better investment than Blackstone, though the US company has produced a 35% return. CIC started to invest in Alibaba in September 2012, when Alibaba was purchasing part of Yahoo for US$7.6 billion………………………………………..Full Article: Source

2014 Permanent Fund Dividend To Be Announced Sept. 17

Posted on 10 September 2014 by VRS  |  Email |Print

One of Alaska’s most anticipated announcements of the year, the amount of the 2014 Permanent Fund Dividend, will be revealed next week. Gov. Sean Parnell’s office says he will announce the amount of this year’s dividend at 10:30 a.m. Sept. 17, at the Atwood Building in Downtown Anchorage.
On Friday, Channel 2 made its annual prediction of the dividend’s amount at $1,909. The first round of deposits are expected to hit Alaskan bank accounts in the beginning of October………………………………………..Full Article: Source

China’s sovereign fund, Boyu, selling some Alibaba shares

Posted on 09 September 2014 by VRS  |  Email |Print

Alibaba Group Holding Ltd’s initial public offering could raise more than $21 billion, valuing the Chinese e-commerce giant at up to $163 billion. Yahoo Inc, the company’s second-largest shareholder, had already disclosed it will sell part of its stake in the IPO, but several other companies and individuals were unveiled as sellers in Alibaba’s latest filing released on Friday.
Alibaba directors and executive officers as a group would make up the second-biggest sellers of stock after Yahoo, potentially raising $1.23 billion from their stakes. The company did not break down the names of each executive selling shares. Other sellers include Chinese sovereign wealth fund China Investment Corporation (CIC), Singapore state investor Temasek Holdings, Saudi Arabia’s Olayan Group and several private equity firms………………………………………..Full Article: Source

Westports sees bright side of possible Khazanah sale

Posted on 09 September 2014 by VRS  |  Email |Print

Westports Holdings Bhd is not surprised by the rumour that Khazanah Nasional Bhd may divest its entire 4.74% stake in the port operator, and is taking the news positively as an avenue to increase its free float, said chief executive officer Ruben Emir Gnanalingam.
StarBiz had on Monday, quoting a source, reported that Khazanah was looking to cash out with quite a handsome gain from Westports and intended to place out its shares to other funds. Ruben, however, was not able to confirm this, as Khazanah had not communicated the matter………………………………………..Full Article: Source

Sovereign wealth fund CIC at risk with Bumi investment

Posted on 08 September 2014 by VRS  |  Email |Print

Sovereign wealth fund China Investment Corp (CIC) risks sinking deeper into the quagmire of its investment in Bumi Resources, Indonesia’s biggest coal miner, which is beset by financial woes and allegations of environmental damage.
Bumi is Indonesia’s largest thermal coal producer and one of the top three largest thermal coal exporters by tonnage globally. In September 2009, CIC lent US$1.9 billion to Bumi, a risky move since Bumi has incurred a lot of debt over the past decade. Bumi defaulted by missing a principal payment on US$375 million of convertible bonds on August 12, according to Moody’s………………………………………..Full Article: Source

SOFAZ earns huge profit from ACG, Shah Deniz projects

Posted on 04 September 2014 by VRS  |  Email |Print

Azerbaijan’s state oil fund SOFAZ has gained over $105.802 billion from 2001 to September 1, 2014 by implementing the project of developing the giant Azeri-Chirag-Gunashli (ACG) block of oil and gas fields in the Azerbaijani sector of the Caspian Sea.
“The fund received $10.77 billion from January to September 1, 2014 within the framework of ACG project,” SOFAZ told Trend Agency on September 2. The ACG block of fields has been active since 1997. Production started from the Chirag part of the field. It was followed successfully by Azeri Project; Central Azeri production in February 2005, West Azeri in December 2005, and East Azeri in October 2006………………………………………..Full Article: Source

Oil tax: Norway could teach Australia a thing or two about managing wealth

Posted on 04 September 2014 by VRS  |  Email |Print

Thanks to natural resources, Norway is a country of five million trustifarians – with each person theoretically being a millionaire. In Australia, mining benefits a selected few. Norway’s government Pension Fund Global was created in 1990 to make the most of the windfall of striking oil in the North Sea. Companies looking to extract Norwegian oil pay handsomely for the privilege.
The Norwegian government sums up the fund with the rather lengthy fortune cookie-like phrase “One day the oil will run out, but the return on the fund will continue to benefit the Norwegian population.” The bulging sovereign wealth fund, managed by the Norwegian government, is set to top $1trn within this decade. At the end of 2013, its value stood at 5.2trn kroner – that’s $903.4bn………………………………………..Full Article: Source

Russia Funnels More Billions Into its Sovereign Wealth Funds

Posted on 03 September 2014 by VRS  |  Email |Print

Russia’s two oil revenue-funded sovereign wealth funds swelled by 353.3 billion rubles ($9.4 billion) last month to reach combined reserves of 6.54 trillion rubles ($177 billion), boosting the state’s financial firepower as the West applies the economic screws on Russia over the Ukraine crisis.
Russia’s Reserve Fund, which hoards U.S. dollars, euros and pounds sterling to insulate Russia against falling oil and gas prices, had assets worth 3.4 trillion ($91.7 billion) on Sept. 1, up 292 billion rubles, or 9.4 percent, from the start of August, according to the Finance Ministry………………………………………..Full Article: Source

Russia Mulls Ring-Fencing SWF from Sanctions

Posted on 03 September 2014 by VRS  |  Email |Print

The $10 billion Russian Direct Investment Fund (RDIF) could be transferred from state ownership to the country’s central bank to avoid economic sanctions that may be applied over the Ukraine conflict.
The fund’s array of Asian, European, Middle Eastern, and North American co-investors are concerned its ability to invest might be stifled should global security organisations agree limits on its finances, Bloomberg reported………………………………………..Full Article: Source

‘Priority investors’ sell Royal Mail shares

Posted on 03 September 2014 by VRS  |  Email |Print

Many of the “priority investors” in Royal Mail, brought in supposedly to remain long term, stable holders of the privatised service, quietly sold millions of their shares over the summer. The Independent’s analysis of share trading data shows priority firms JPMorgan, Schroders and Abu Dhabi’s sovereign wealth fund also slashed their holdings in recent months. The Kuwait Investment Authority, another sovereign wealth fund, sold more than £8m of shares. It remains a major investor.
JPMorgan sold £1.3m of shares last month, taking its holding down to one million shares, the Abu Dhabi sovereign wealth fund sold nearly half of its one million shares and Schroders sold more than 40 per cent of its holding for more than £2.1m – a sale likely to have profited it to the tune of more than £500,000………………………………………..Full Article: Source

Khazanah’s restructuring hits at right target for MAS

Posted on 03 September 2014 by VRS  |  Email |Print

Khazanah Nasional’s recovery plan for Malaysia Airlines (MAS) may be the start of the new beginning for the airline, says RHB Research. It said on Tuesday the plan raised key concerns which had always weighed on MAS’ performance while showing the commitment of the related parties to revive the airline.
“Effective execution is key. We advise minority shareholders to accept the 27 sen offer price from Khazanah. Maintain Neutral,” said the research house. Khazanah’s revamp plan for MAS involved a RM4.6bil capital injection (after privatisation), ii) a 30% cut in workforce, and iii) review of routes and renegotiation of supply contracts………………………………………..Full Article: Source

Russia Said to Prepare Transfer of $10 Billion Fund Out of Sanctions’ Reach

Posted on 02 September 2014 by VRS  |  Email |Print

Russia is preparing to transfer the ownership of a $10 billion sovereign wealth fund to the central bank from a sanctioned state-development lender, according to two people with knowledge of the plan.
Russian Direct Investment Fund’s co-investors, which include sovereign funds in Europe and Asia, are concerned that sanctions may affect their investments in Russia if the state lender controls the assets, according to one of the people, who asked not to be identified because the information is private………………………………………..Full Article: Source

Putin says spending from Russia’s sovereign fund can’t be raised

Posted on 02 September 2014 by VRS  |  Email |Print

Russia cannot spend more of the $83 billion parked in its National Wealth Fund (NWF), President Vladimir Putin said on Monday, after the government recently raised the cap on how much of the fund can be used for domestic investments. Spending pressure on the government has increased as a result of the Ukraine crisis, which has led several Russian companies to request state finance to compensate for the closure of western capital markets.
The NWF, a fiscal reserve financed from oil taxes, has become a prime target for lobbyists, notably since Russia has earmarked 60 percent of the Fund for internal investments, particularly infrastructure projects………………………………………..Full Article: Source

Khazanah denies RM6 billion as bailout in MAS turnaround

Posted on 01 September 2014 by VRS  |  Email |Print

The RM6 billion to be injected into troubled Malaysia Airlines (MAS) is not a bailout, said state national fund Khazanah Nasional Berhad, as it unveiled a massive revamp today to turn the national carrier around. Khazanah managing director Tan Sri Azman Mokhtar said the money can be recovered when the flag carrier is projected to attain profitability by the end of 2017, and when it prepares for relisting between 2018 and 2020.
“The RM6 billion is not a bailout and can be recovered,” he said after announcing details of the restructuring plan. Over the last ten years, Khazanah had pumped RM7 billion into the ailing airline, with RM5.7 billion alone in the last five years through three rights issues………………………………………..Full Article: Source

New GPIF investment manager drawn to cheap Japan mid-caps

Posted on 01 September 2014 by VRS  |  Email |Print

A new investment manager responsible for a small chunk of the $1.2 trillion portfolio held by Japan’s giant public pension fund says it expects to buy stocks in midsize companies that appear cheap relative to the broader market and have decades of steady profits.
Appointed in April to manage 100.4 billion yen ($967 million) of the Government Pension Investment Fund’s (GPIF) 20.8 trillion yen in Japanese equities, Eastspring Investments’ approach offers an insight into how the world’s biggest institutional investor’s money will be used………………………………………..Full Article: Source

Kazakhstan inks additional contracts with Russia for imports of fuel and lubricants

Posted on 01 September 2014 by VRS  |  Email |Print

KazMunaiGas Onimderi (KMGO) is taking all necessary measures for a smooth selling of oil products at the filling stations of KazMunaiGas, and to saturate the retail market of fuel and lubricants.
KMGO is a 100-percent subsidiary of the KazMunaiGas - Processing and Marketing Joint-Stock Company. KazMunaiGas’ shares are wholly owned by the Samruk-Kazyna National Welfare Fund………………………………………..Full Article: Source

Even at reduced levels, the oil dividend provides a significant fillip to Alaska’s income.

Posted on 29 August 2014 by VRS  |  Email |Print

The Alaska Permanent Fund was founded in 1976 as a basin to hold “at least 25 percent of all mineral lease rentals, royalties, royalty sales proceeds, federal mineral revenue-sharing payments and bonuses received by the state.” Its beneficiaries, according to the state constitution, were to be “Alaska and all present and future generations of Alaskans.”
Each year, about one-quarter of the oil production tax flows into the fund’s coffers. And even though production in Alaska has fallen over time, the elevated price of oil has kept the volume of revenues high. In 2013, some $840 million flowed into the fund………………………………………..Full Article: Source

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