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Sovereign Wealth Funds Briefing - Archive | January, 2013

GIC promotes from within to replace group CIO

Posted on 07 January 2013 by VRS  |  Email |Print

Singapore sovereign wealth fund GIC has announced that Lim Chow-Kiat is being promoted to group chief investment officer, effective from February 1. Previously group deputy CIO, he succeeds Ng Kok-Song, who retires after 42 years in management of the city-state’s foreign reserves. Ng will become an adviser to GIC in the role of chair of global investments.
In a published letter, GIC chairman and prime minister Lee Hsien Loong took the opportunity to thank Ng for his long service, which predates the establishment of GIC in 1981………………………………………..Full Article: Source

Azerbaijan’s Paris, Moscow buys take European RE over EUR450mln

Posted on 07 January 2013 by VRS  |  Email |Print

The State Oil Fund of Azerbaijan, the Caspian Sea nation’s €34bn sovereign wealth fund, has announced real estate acquisitions in Paris and Moscow, adding to a purchase in London to bring 2012 European property commitments to around €454m, one-quarter of its permitted allocation.
In France SOFAZ agreed in December to pay €135m to buy 8 Place Vendôme, a prestigious Paris prime office and retail property, from AXA Real Estate Investment Managers. The office, retail and residential space is located in an iconic 18th century mansion and an office building from the 1950s………………………………………..Full Article: Source

Norway Oil Fund in EUR2.4bln Prologis JV; targets $11bln at US property

Posted on 07 January 2013 by VRS  |  Email |Print

Norway has granted permission for its giant €508bn pension fund to invest in property outside Europe from this year. The news came days after its manager, Norges Bank Investment Management, signed a €2.4bn joint venture with US-based Prologis to invest in European industrial property - and followed an announcement that it is also targeting $11bn at the US.
Norwegian Finance Minister Sigbjoern Johnsen announced the widened global real estate mandate in late December. “By spreading our investments we contribute to a continued secure and long-term management of the fund,” he said in a statement following establishment of the nation’s 2013 budget………………………………………..Full Article: Source

Brazil appeals to sovereign fund and state companies’ profits to meet 2012 fiscal target

Posted on 07 January 2013 by VRS  |  Email |Print

The Treasury will withdraw 8.85 billion Reais (4.3 billion dollars) from its sovereign wealth fund and 4.7 billion Reais in dividends from state-owned bank Caixa Economica Federal, according to a Dec. 31 decision published in the official gazette.
President Dilma Rousseff administration last year cut taxes and stepped up public works spending as it struggled to revive an economy that the central bank estimates expanded by 1%. Tax breaks reduced federal revenue by 45 billion Reais last year, according to Finance Minister Guido Mantega………………………………………..Full Article: Source

Polls and stat - Sovereign wealth funds

Posted on 07 January 2013 by VRS  |  Email |Print

In 2012, the world’s top 36 sovereign wealth funds totaled nearly $5 trillion. Oil- and gas-related SWFs comprised the majority of the overall dollar amount, at 57.3%. With 40.5% of the total pie, Asia was the region with the largest share, followed by the Middle East with 35.6%.
The first-ever SWF was the Kuwait Investment Authority, created in 1953 from oil revenues before Kuwait even gained independence from the United Kingdom; that fund is now worth nearly $300 billion. Since 2000, the number of sovereign wealth funds has increased dramatically………………………………………..Full Article: Source

Brazil taps into sovereign fund to meet 2012 fiscal target

Posted on 04 January 2013 by VRS  |  Email |Print

Brazil tapped into its sovereign wealth fund and state companies’ profits in an effort to meet its 2012 fiscal target.
The Treasury will withdraw 8.85 billion reais ($4.3 billion) from its sovereign wealth fund and 4.7 billion reais in dividends from state-owned bank Caixa Economica Federal, according to a Dec. 31 decision published in today’s official gazette………………………………………..Full Article: Source

Why the US needs its own sovereign wealth fund

Posted on 04 January 2013 by VRS  |  Email |Print

Why not create a separate government agency to run a US sovereign wealth fund? Then the Fed can stick to what it does best—keeping the economy on track—while the sovereign wealth fund takes the political heat, gives the Fed running room, and concentrates on making a profit that can reduce our national debt.
Sovereign wealth funds are already standard for governments that have paid off their national debt and gone into the black. And some countries have both debt and sovereign wealth funds on their balance sheet. In order of holdings, the Monitor Group’s Sovereign Wealth Fund Assets Under Management Table shows that Norway, China, United Arab Emirates, Singapore, and Kuwait have the top sovereign wealth funds………………………………………..Full Article: Source

Alaskans: Sign up now to score a Permanent Fund payout this fall

Posted on 04 January 2013 by VRS  |  Email |Print

The application process has begun for 2013 Alaska Permanent Fund Dividends, and it’s open to all eligible Alaska residents at the PFD Division website. The deadline for applying is March 31. On New Year’s Day, nearly 21,000 Alaskans had already filled out their applications online. Last year, the payout was $878.
A record 471 Alaska non-profit entities are already asking everyone eligible to receive a permanent fund dividend this year to share it with them through the Pick.Click.Give program. In 2012, Bean’s Café in Anchorage became the first nonprofit to receive pledges totaling more than $100,000………………………………………..Full Article: Source

Singapore’s GIC names Lim Chow Kiat new group CIO

Posted on 04 January 2013 by VRS  |  Email |Print

The Government of Singapore Investment Corporation (GIC) said on Friday that Lim Chow Kiat will be its next group chief investment officer from Feb 1, succeeding Ng Kok Song who is retiring.
Lim, 42, is currently GIC’s deputy group chief investment officer. He joined the Singapore sovereign wealth fund in 1993 after graduating with first class honours in accountancy from Nanyang Technological University. Lim was appointed head of GIC’s Fixed Income, Currency and Commodities Department in 2008………………………………………..Full Article: Source

Singapore - State fund raises stake in Olam to 19pct

Posted on 04 January 2013 by VRS  |  Email |Print

Olam International Ltd., which has been battling short-seller Muddy Waters since November, said on December 28 that Singapore state investor Temasek Holdings had raised its stake in the commodities firm to 19% from 18%.
Temasek has been building up its stake in Olam since Muddy Waters launched a scathing attack on the company’s accounting, debt and investment strategy on November 19…………………………………………Full Article: Source

China’s investment in UK will be ‘explosive’

Posted on 04 January 2013 by VRS  |  Email |Print

Executives of China Investment Corp, a $410 billion sovereign wealth fund, have repeatedly said that the company will seek infrastructure deals in the UK. They agreed to buy a 10 percent stake in Heathrow Airport in October.
This follows closely on the fund picking up a stake in Thames Water last year. “We could say the UK is the most open market worldwide, especially in the infrastructure sector, and this means huge business for China,” said Zhou Xiaoming, minister counselor of the Chinese embassy in the UK……………………………………….Full Article: Source

Azerbaijani State Oil Fund budget approved for 2013

Posted on 03 January 2013 by VRS  |  Email |Print

Azerbaijani President Ilham Aliyev has approved the budget of the State Oil Fund of Azerbaijan (SOFAZ) for 2013, the State news agency AzerTAj informed. According to the approved budget, SOFAZ revenues for 2013 are estimated at 11.482 billion manat with expenses at 13.403 billion manat.
According to the revenue side of the budget for this year, the net proceeds from the sale of hydrocarbons are provided at a rate of 11.171 billion manat; acreage payments to investors is 1.833 million manat, income from transportation of oil and gas through Azerbaijan 9.223 million manat, income derived from the placement and management of the Fund’s assets 287.448 million manat……………………………………….Full Article: Source

Wealthy Gulf investors warm to Africa

Posted on 03 January 2013 by VRS  |  Email |Print

In November Abu Dhabi-based asset manager Invest AD launched a fixed income fund that will focus on Africa as well as the Middle East. Along with Morocco’s Attijariwafabank, it also said it would launch a fund to invest in African companies listed on stock markets.
Qatar’s Hassad Food, an arm of the country’s sovereign wealth fund, agreed in 2009 on a $1-billion farmland development joint venture with the government of Sudan………………………………………..Full Article: Source

Qatar’s $1.45bln Heathrow deal cleared for take-off

Posted on 03 January 2013 by VRS  |  Email |Print

Qatar Holding has received European Union approval for its purchase of a stake in London’s Heathrow Airport. The total deal, worth US$1.45 billion (Dh5.32bn) will see a further 10.62 per cent of Heathrow Airport Holdings (HAH), formerly BAA, transferred from Spanish infrastructure firm Ferrovial to the Qatari global investment house, part of the country’s sovereign wealth fund, the Qatar Investment Authority.
Agreement was reached on the deal in August and only awaited a ‘green light’ from the EU’s competition authorities. As part of this same transaction, Qatar Holding also acquired stakes of 5.63 per cent of Ferrovial’s Heathrow holding company, FGP Topco, from another of Heathrow’s shareholders, Britannia Airport Partners. The Qataris also acquired 3.75 per cent from another shareholder, GIC (Government of Singapore Investment Corporation)………………………………………..Full Article: Source

Qatar’s foreign investment hits QR163.8bln in 2012

Posted on 03 January 2013 by VRS  |  Email |Print

Qatar’s sovereign wealth fund (SWF) investment in abroad has reached QR163.8bn in 2012. The country’s 2012 foreign investment is $32bn higher than the previous year, Al Sharq reported.
Apart from the Arab region, Qatar made major investments in Singapore, France, UK, Italy, Switzerland, the US, Vietnam, Iraq, Netherlands, Turkey, Bulgaria, Germany, China and Malaysia in 2012. Qatar invested in a wide range of sectors in 2012, including in hotels, resorts, petrochemicals, power plants, oil companies, banks and financial institutions, fashion, mining, media and communications, roads, transportation and sports in these countries………………………………………..Full Article: Source

A real estate tale of two cities

Posted on 03 January 2013 by VRS  |  Email |Print

Paris looks to steal a march on London as the key target for chinese property investors. After China Investment Corp, the country’s $410-billion (313 billion euros) sovereign wealth fund, bought Deutsche Bank’s headquarters in London for a reported $403 million, the French capital stepped up its efforts to lure Chinese investors interested in the European commercial real estate market.
“We have one competitor in Europe, which is London,” said Benoit du Passage, chairman and CEO of the real estate company Jones Lang LaSalle France and Southern Europe……………………………………….Full Article: Source

LeapFrog eyes more deals

Posted on 03 January 2013 by VRS  |  Email |Print

LeapFrog Investments, a US-based private equity (PE) firm, is betting big on the Indian insurance sector. LeapFrog, which has made two deals in India so far, appointed Michael Fernandes, former India head of Khazanah Nasional, as partner (Southeast Asia), in December 2012.
At Khazanah Nasional, the sovereign wealth fund of the Malaysian government, Fernandes was responsible for over $700 million of direct investments in India, including Yes Bank and L&T Finance………………………………………..Full Article: Source

India plans to create sovereign wealth fund

Posted on 02 January 2013 by VRS  |  Email |Print

The finance ministry is working on the contours of the sovereign wealth fund and there may be an announcement in next year’s Budget. Earlier, it was proposed as a fund with a Budgetary allocation of around Rs 30000 crore, but considering that the finance ministry is fiscally constrained at this point in time it is mulling other alternatives like it being a government-backed fund instead of purely government fund and using reserves of large PSUs as well as raising debt.
The idea of the fund is to allow for acquisition of natural resources abroad especially in the oil and mineral space………………………………………..Full Article: Source

Russia ready to help India in setting up sovereign wealth fund

Posted on 02 January 2013 by VRS  |  Email |Print

Russia has expressed willingness to help India in setting up a sovereign wealth fund. The chief of the $ 10 billion-Russian Direct Investment Fund (RDIF) said it would be a good idea for India to have a sovereign wealth fund.
“Generally, we believe that India has quite a bit of potential if it were to set up a sovereign wealth fund because India is a huge economy with tremendous promise and we need to allocate capital, within and outside India, through partnerships, which we believe would be a good idea,” RDIF Chief Executive Officer Kirill Dmitriev said……………………………………….Full Article: Source

Russian sovereign wealth fund, SBI to set up $2 bln investment fund

Posted on 02 January 2013 by VRS  |  Email |Print

State Bank of India and the $10-billion Russian sovereign wealth fund, RDIF, on Monday signed a memorandum of understanding to set up a $2-billion consortium to promote direct investment. The pact was among the 10 deals, including defence, that were signed at the 13th annual India-Russia summit.
In a joint statement, Prime Minister Manmohan Singh and the visiting Russian President Vladimir Putin reviewed the progress made in key areas of co-operation including energy, trade, high technology and military-technical co-operation and noted that they shared common views on all the important issues of regional and international co-operation………………………………………..Full Article: Source

China’s wealth fund bids on U.K. Blackstone campus

Posted on 02 January 2013 by VRS  |  Email |Print

China’s sovereign wealth fund is among a trio of Asian investors vying to buy an 800-million-pound ($1.29 billion) London office campus from Blackstone Group in what would be the U.K.’s highest-value property deal since the start of the financial crisis.
China Investment Corp. and government-backed funds from South Korea and Malaysia have put forth bids for Chiswick Park, Blackstone’s 1.1-million-square-foot development, the FT reported, citing unnamed people familiar with the process………………………………………..Full Article: Source

PBOC may have shifted cash to wealth funds, China Merchants says

Posted on 02 January 2013 by VRS  |  Email |Print

China’s central bank may have added billions of dollars to the country’s sovereign wealth fund, China Merchants Securities said after analyzing official data from last month.
The People’s Bank of China may have injected funds into China Investment Corp. or “have taken similar actions” to cause a big drop in its yuan positions last month, said Xie Yaxuan, an analyst at the brokerage, who used to work for the foreign-exchange regulator………………………………………..Full Article: Source

Temasek raises stake in Olam

Posted on 02 January 2013 by VRS  |  Email |Print

Investment giant Temasek Holdings has continued to buy more shares in Olam International, offering further support to the commodity trader under attack from United States-based-short seller Muddy Waters.
Two units controlled by Temasek bought about 24 million shares, lifting its stake to 19 per cent from 18 per cent, according to Olam’s regulatory filing with the Singapore Exchange. Temasek spokesman Stephen Forshaw said: “In our judgment, (Olam) represents a reasonable attractive investment over the long term.”……………………………………….Full Article: Source

Establishing and managing a Philippine sovereign wealth fund

Posted on 02 January 2013 by VRS  |  Email |Print

My main contention was that the Philippines is currently suffering from “Dutch disease” or the adverse effects of a sudden rise of income from its export of labour and from a rise of confidence in its domestic economy. In this second part, I will discuss how we could govern and operate our own SWF.
The Santiago Principles established by 26 countries with SWFs known as the International Working Group or IWG in 2008 lays out a number of generally accepted principles and practices or GAPP to ensure that “the SWF arrangements are properly set up and investments are made on an economic and financial basis”………………………………………..Full Article: Source

Kazakh wealth fund said to weigh acquisition of Kazzinc stake

Posted on 02 January 2013 by VRS  |  Email |Print

Kazakhstan’s sovereign wealth fund is considering buying into metals producer Kazzinc after Glencore International AG cut a planned purchase by half this year, according to two people with knowledge of talks.
Samruk-Kazyna, as the wealth fund is known, hasn’t decided on bidding for the remaining shares that Glencore doesn’t hold, the people said, without giving price guidance and asking not to be identified because the talks are private………………………………………..Full Article: Source

Kazakh fund: Kashagan contract extension to be discussed after 2014-2015

Posted on 02 January 2013 by VRS  |  Email |Print

The issue of extending the contract on field development at Kashagan will be discussed after 2014-2015, managing director of the Kazakh Sovereign Wealth Fund Samruk-Kazyna Malik Salimgereyev told the media today. “It is too early to speak about extending the term,” he said. “Firstly, extending the contract is a duty of the Kazakh Oil and Gas Ministry.”
The PSA for the Kashagan oil field was signed by the Kazakh government and investors in 1997 for a period of 40 years. According to conditions, the cost of deposit exploration is paid for by income from commercial oil production. Now, foreign investors arguing economic expediency are seeking to increase the terms of the contract for another 20 years………………………………………..Full Article: Source

Azeri State Oil Fund buys Moscow real estate for $133 mln

Posted on 02 January 2013 by VRS  |  Email |Print

The State Oil Fund of Azerbaijan, known as Sofaz, bought a shopping and business center in the Russian capital, Moscow, for $133 million as it continues to diversify its reserves.
Sofaz bought 100 percent of Tverskaya, 16 OAO, which owns the Galereya Aktyor (Actors’ Gallery) building in central Moscow, the Baku-based fund said today in an e-mailed statement. The 18,000 square-meter center was built in 1882………………………………………..Full Article: Source

Falklands’ share Norway’s oil wealth fund and port infrastructure experience

Posted on 02 January 2013 by VRS  |  Email |Print

Though plagued with flu and taking place largely in darkness, the recent visit to Norway by Members of the Legislative Assembly and senior government officials appears to have produced encouraging results and shone some light on possible developments in the Falkland Islands, according to MLA Dick Sawle.
MLA Sawle said that the Norway visit had “two strands”. One of these was to study the Norwegian approach to the regulation and development of the oil industry, which was the particular focus of fellow MLA Dr Barry Elsby, and the other, which was of particular relevance to his own portfolio responsibilities was to do with port infrastructure………………………………………..Full Article: Source

Mozambique: Government considering sovereign wealth fund

Posted on 02 January 2013 by VRS  |  Email |Print

Mozambique is considering the possibility of using revenue from the exploitation of mineral resources to set up a sovereign wealth fund, but only if this does indeed help solve the problems facing the country.
Speaking on a joint radio and television programme on Saturday, focusing on the activities undertaken by the government over the past year, Prime Minister Alberto Vaquina said that the question of a sovereign wealth fund is under discussion, but no decision has yet been taken………………………………………..Full Article: Source

Angola wealth fund to announce policies, appoint auditors

Posted on 02 January 2013 by VRS  |  Email |Print

Angola, Africa’s second-biggest oil producer, will publish the investment policy of its sovereign wealth fund in the first quarter of next year and appoint international auditors, Chairman Armando Manuel said.
The fund, announced on Oct. 17 with $5 billion in assets, will be established by the sale of 100,000 of Angola’s 1.8 million barrel-a-day oil output from companies including Exxon Mobil Corp. (XOM), Chevron Corp. (CVX), BP Plc (BP/) and Total SA. (FP)……………………………………….Full Article: Source

Rise of the African sovereign wealth fund

Posted on 02 January 2013 by VRS  |  Email |Print

African sovereign wealth funds are emerging to save and invest resource revenues. If efficient, they could also boost domestic growth and credit ratings. A spate of sovereign wealth funds are opening across Africa as resource-rich countries look to manage their revenues. Nigeria and Angola have both launched funds in recent months, with Tanzania’s president Jakaya Kikwete also stating his intent to set aside revenues from new gas discoveries.
Almost every member of Opec operates a sovereign wealth fund - a state-owned investment fund - to ring-fence oil revenues and ease the impact of commodity price volatility. Now, after years of poor fiscal management and the ‘resource curse’, African countries are also looking to SWFs to save hydrocarbon revenues, diversify their wealth and boost domestic growth………………………………………..Full Article: Source

Effective take-off of Nigeria’s SWF to boost global fund assets

Posted on 02 January 2013 by VRS  |  Email |Print

The news that the investment programme of the Nigerian Sovereign Wealth Investment Authority (NSIA) will finally begin in March, 2013, is set to further boost the value of Sovereign Wealth Funds (SWF) globally which, as at the end of April 2012, stood at just under $5 trillion.
The ministry of finance last week said the Nigeria SWF is making progress towards becoming fully operational and that the Strategy Document which will guide its operations was ready, while its investment policy guidelines and the processes for the three fund mandate were almost finalised………………………………………..Full Article: Source

Saudi Arabia to create sovereign fund for future generations

Posted on 02 January 2013 by VRS  |  Email |Print

The government will allocate SR 200 billion from 2012 budget surplus to implement transport projects inside cities, bringing total spending in 2013 to more than SR 1 trillion, Finance Minister Ibrahim Al-Assaf said.
“We have not yet finalized the 2012 surplus because of new expenditures and revenues, especially nonoil revenues,” Al-Assaf told Al-Arabiya channel. He said the remaining amount from the surplus of an estimated SR 386 billion would be kept in public reserve………………………………………..Full Article: Source

Qatar Investment Authority raises stake in Tiffany & Co

Posted on 02 January 2013 by VRS  |  Email |Print

The Qatar Investment Authority has raised its investment stake in Tiffany & Co. to 7.8 percent from 5.2 percent, according to a regulatory filing on Monday the 24th of December. The sovereign wealth fund based in Doha owns now nearly ten million shares.
According to the filing with the Securities and Exchange Commission, a Schedule 13G, presented earlier this week, the aggregate amount of shares owned by the Qatar fund is slightly more than 9.9 million shares. The shares were transferred on Dec. 17 to Qatar Holding USA LLC, a wholly owned subsidiary of QIA, from Qatar Holding LLC, another wholly owned subsidiary of QIA………………………………………..Full Article: Source

Mubadala sells land for Abu Dhabi retail project

Posted on 02 January 2013 by VRS  |  Email |Print

Mubadala Real Estate & Infrastructure (MREI) has announced the sale of four land plots on Al Maryah Island in Abu Dhabi for a retail project. MREI, a business unit of Mubadala Development Company, sold the plots to Gulf Related to deliver a further 288,200 sq m of retail space in Sowwah Square.
“The expansion will provide a world class regional retail destination that will include residential and hotel development in line with the vision of the Government of Abu Dhabi for the Al Maryah Island master plan,” a statement said without giving the value of the deal………………………………………..Full Article: Source

What the world’s largest sovereign wealth fund will buy soon

Posted on 02 January 2013 by VRS  |  Email |Print

“What is a sovereign wealth fund?” asked one of my colleagues the other day. “Good question,” I countered, and then I began to stumble through a rough answer of what I could remember about these types of funds.
Checking with Investopedia I reacquainted myself with the correct answer. A sovereign wealth fund is “a pool of money derived from a country’s reserves, which are set aside for investment purposes that will benefit the country’s economy and citizens………………………………………..Full Article: Source

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