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Sovereign Wealth Funds Briefing - Archive | July, 2009

France’s SWF to invest $1.3 bln by end of year

Posted on 31 July 2009 by VRS  |  Email |Print

From Bloomberg: France’s sovereign wealth fund may spend 900 million euros ($1.3 billion) before the end of the year and increase aid to the auto industry in 2010, as the recession batters companies’ finances.

The 20 billion-euro investment pool, set up last year by President Nicolas Sarkozy, may provide capital to suppliers of Airbus SAS and Safran SA and open a fund for smaller companies, said Gilles Michel, managing director of the fund……….Full Article: Source

CIC wades into U.S. hedge funds

Posted on 31 July 2009 by VRS  |  Email |Print

From WSJ: China Investment Corp.’s $200 billion sovereign-wealth fund is reaching out to old friends in the U.S. as it ventures into hedge-fund investing.
The fund has selected Morgan Stanley and Blackstone Group LP to oversee hundreds of millions of dollars in new private-fund investments, people familiar with the matter say……….Full Article (Subscription Required) : Source

CIC taps Morgan Stanley, Blackstone hedge-fund units for allocations

Posted on 31 July 2009 by VRS  |  Email |Print

From WSJ: China Investment Corp. has selected Morgan Stanley’s asset-management unit and Blackstone Group LP to oversee hundreds of millions of dollars in allocations as it ventures into the U.S. hedge-fund business.
China’s $200 billion sovereign-wealth fund has finalized an allocation of $500 million to Blackstone Group’s fund-of-funds unit, so called because it farms out clients’ money to dozens of individual hedge funds, and also has earmarked additional money to be overseen by Morgan Stanley’s asset-management unit, according to people familiar with the situation……….Full Article (Subscription Required) : Source

Kuwait’s KIA wants updates on Zain’s stake sale

Posted on 31 July 2009 by VRS  |  Email |Print

From Reuters: Kuwait Investment Authority (KIA), the Gulf state’s sovereign wealth fund, has asked Zain to keep it updated on any talks linked to a stake sale in the mobile operator, a local newspaper said on Thursday.

KIA, which owns 24.6 percent of Zain, said it wants to be able to evaluate any offer based on its own investment strategy, al-Qabas said in an unsourced report citing correspondence between two parties……….Full Article: Source

Future Fund warms to bank debt

Posted on 31 July 2009 by VRS  |  Email |Print

From The $58 billion Future Fund is prepared to start wading back into the market to invest in bank debt that doesn’t carry the backing of a Government guarantee.

The indication of the fund’s stance by chairman David Murray underscores growing confidence among major debt investors in the health of the banks. This attitude is likely to lead to cheaper pricing for their wholesale funding……….Full Article: Source

Future Fund to invest in private equity

Posted on 31 July 2009 by VRS  |  Email |Print

From The Future Fund is looking at investing in private equity, debt and infrastructure, its chairman David Murray says.

The fund still had a significant proportion of its funds in cash, Mr Murray said at an American Chamber of Commerce luncheon in Sydney on Thursday……….Full Article: Source

Temasek tries a new tack

Posted on 31 July 2009 by VRS  |  Email |Print

From WSJ: Stung by a botched CEO succession and unprecedented public griping over its losses, Singapore’s Temasek Holdings is offering up some radical thinking on the direction of state-run funds.

The fund is considering allowing institutions, and eventually Singapore’s public, to team up with it on investments. For now, Temasek is calling the plan a long-term one, and offering few details on how it’ll work……….Full Article(Subscription Required) : Source

Temasek says it will hold on to ‘family jewels’

Posted on 31 July 2009 by VRS  |  Email |Print

From Temasek Holdings, reeling from the aborted appointment of Charles Goodyear, said yesterday it had lost more than S40bn ($27,7bn) in asset value and that the sovereign fund might allow public investment for the first time.

The Singapore investment company would seek “sophisticated investors” and would not sell the “family jewels” for short-term gains, CEO Ho Ching, the wife of Singaporean Prime Minister Lee Hsien Loong, said………Full Article: Source

It is not too late for a Scottish oil wealth fund, says Swinney

Posted on 31 July 2009 by VRS  |  Email |Print

From Finance Secretary John Swinney insisted yesterday that it was not too late for Scotland to create an oil fund to cushion the country’s future.

He accused Westminster of squandering billions of pounds in North Sea revenues……….Full Article: Source

Finmeccanica, Libyan Investment Authority JV

Posted on 31 July 2009 by VRS  |  Email |Print

From Dow Jones: Italian state-controlled defense and aerospace company Finmeccanica SpA will create a joint venture to invest in developing civil projects in Africa and the Middle East with the Libyan Investment Authority, it said late Tuesday.

The joint venture, which will start Jan. 1, is the first industrial joint venture between the two countries following a landmark agreement in August 2008 for Italy to pay $5 billion over 20 years as compensation to Libya for its colonial past……….Full Article (Subscription Required) : Source

NSSF mulls bond to enter construction sector

Posted on 31 July 2009 by VRS  |  Email |Print

From The National Social Security Fund, looks set to venture into infrastructure development for long-term growth as the drive to diversify and weather competition intensifies.
In an exclusive interview, NSSF managing trustee Alex Kazongo said the pensions manager would take a plunge into construction of residential houses, bridges and roads, among others, through infrastructure bonds in one-and-half years……….Full Article: Source

Wannarat: Oil fund crucial for future

Posted on 31 July 2009 by VRS  |  Email |Print

From Appropriate levy rates for the state Oil Fund are crucial for financing alternative fuel development, says Thailand Energy Minister Wannarat Channukul.

He was responding yesterday to complaints by senators that motorists were suffering because the levies collected on fuel were too high……….Full Article: Source

Nations need to attract, not punish, responsible sovereign investment

Posted on 31 July 2009 by VRS  |  Email |Print

From The economy is in big trouble and investment capital is on standing on the sideline. One significant source of investment capital is the trillions of dollars in sovereign investment funds, whose portfolios have been ravaged and whose reputations have been savaged.

Infusing these massive investment pools back into the markets would provide a significant boost to the economy and would reinstate much of the confidence that has evaporated. The nations that best understand the needs of responsible sovereign investors are the nations that are most likely to attract and retain this much needed investment……….Full Article: Source

Singapore Temasek’s investments lost US$28 bln

Posted on 30 July 2009 by VRS  |  Email |Print

From AP: Singapore government wealth fund Temasek said its investment portfolio lost 40 billion Singapore dollars ($28 billion) during the 12 months ended March as big bets on financial companies went sour.

In a speech Wednesday, Temasek Chief Executive Ho Ching said the fund’s own analysis last year of various investment scenarios had shown there was a 16 percent probability its portfolio could drop that much. “Indeed, it had turned out to be so, and more.”……..Full Article: Source

Singapore group’s portfolio value down by $34bln

Posted on 30 July 2009 by VRS  |  Email |Print

From The value of Singapore state-owned investment company Temasek Holdings portfolio fell more than $S40 billion ($34 billion) at the end of March from a year earlier, chief executive Ho Ching said.
“We are certainly not happy with the negative wealth added in March last year as well as March this year,” Ms Ho said………Full Article: Source

Temasek eyes food, energy after portfolio slump

Posted on 30 July 2009 by VRS  |  Email |Print

From Reuters: Singapore state investor Temasek said its portfolio slid by at least $27 billion, or more than a fifth, in the year to March but it will stick with banks and sees opportunities in food and energy.

The fund saw potential in Asia and Latin America and was comfortable with financial services as ts core portfolio holding, despite being hurt by losses on high-profile investments in Western banks after the market meltdown last year, CEO Ho Ching said on Wednesday………Full Article: Source

The public can invest in… Temasek Holdings

Posted on 30 July 2009 by VRS  |  Email |Print

From Temasek Holdings may invite the public to co-invest with the company in eight to 10 years’ time, allowing it to expand its stakeholder base, chief executive Ho Ching said yesterday.

Under the plan, the company will look for people - including retail investors - who are prepared to invest long term, said Ms Ho………Full Article: Source

Temasek plan for public co-investors may ease sovereign concern

Posted on 30 July 2009 by VRS  |  Email |Print

From Bloomberg: Temasek Holdings Pte’s decision to consider managing money for outside investors may help it overcome foreign governments’ concerns about sovereign wealth fund investment and drive expansion over the next decade.

The Singapore fund may seek “sophisticated co-investors” in five to eight years and retail investors in the next eight to 10 years, Chief Executive Officer Ho Ching said during a speech in Singapore yesterday………Full Article: Source

Scrapping of Temasek succession ‘unfortunate’: CEO

Posted on 30 July 2009 by VRS  |  Email |Print

From AFP: The chief executive of Singapore’s state investment firm said Wednesday that scrapping a plan to install its first foreign head was “unfortunate” but a succession review was going ahead.

Temasek CEO Ho Ching’s comments come after the firm last week said it was rescinding the appointment of US businessman Charles “Chip” Goodyear as her replacement due to differences over strategy………Full Article: Source

When is an SWF not an SWF?

Posted on 30 July 2009 by VRS  |  Email |Print

From FT Alphaville: For a secretive kind of outfit, Temasek is certainly generating a lot of publicity these days. Following the storm of media interest last week over news of the sudden departure of its chief executive-designate Chip Goodyear, the Singaporean state investment agency is again in the news.

This time, the Temasek newsmaker is none other than Ho Ching, the SWF’s low-profile chief executive, wife of Singapore’s prime minister and a renowned shunner of media interviews………Full Article: Source

SWFs must accept credit rating debate is about default risk

Posted on 30 July 2009 by VRS  |  Email |Print

From If it has felt slightly windier than normal this week, it is very likely due to the enormous vacuum that was switched on in Washington, where Uncle Sam was attempting to suck up US$115 billion (Dh422.39bn) in new borrowing.

Now, $115bn is a lot of money, even in Washington. It works out to almost 47 billion gallons of petrol, enough to drive one of GM’s gas-guzzling Hummers from Capitol Hill to Beijing and back 57 million times (if Hummers could float)………Full Article: Source

Kuwait’s KCIC eyes Asian farming investments

Posted on 30 July 2009 by VRS  |  Email |Print

From Kuwait China Investment Co (KCIC), a firm linked to the Gulf Arab state’s sovereign wealth fund, is eyeing investments in Asia’s agriculture sector, the company’s managing director said on Wednesday.
Gulf investors have spent billions of petrodollars on buying foreign farmland to help secure food supplies………Full Article: Source

KFH helps arrange $140mln facility for Mumtalakat

Posted on 30 July 2009 by VRS  |  Email |Print

From Kuwait Finance House – Bahrain (KFH-Bahrain) had played a major role in arranging a five year $140 million syndicated Ijara facility for Bahrain Mumtalakat Holding Company, the investment arm of the Government of Bahrain.

The bank was the sole lead arranger and underwriter for the transaction acting alongside the Liquidity Management Centre (LMC) who acted as Mandated Lead Arranger………Full Article: Source

Is it time for a Scottish wealth fund?

Posted on 30 July 2009 by VRS  |  Email |Print

From Reuters: Oxford SWF Project, a university think tank on sovereign wealth funds, is looking at reports that the latest entry in the field could be Scotland.
The project has a new post about the Scottish government floating the idea of an oil stabilisation fund to use oil and gas revenues. It cites Scottish cabinet secretary for finance John Swinney looking abroad gleefully:……..Full Article: Source

Washington less concerned with CIC?

Posted on 30 July 2009 by VRS  |  Email |Print

From The first round of the US-China Strategic and Economic Dialogue was held in Washington from 27 to 28 July, 2009. It was a star-studded event that saw a candid and in-depth exchange of views on the “strategic, long-term and overarching issues concerning the development of bilateral relations.”
The issue of China’s SWFs came up. In 2007/2008, Washington policymakers were particularly concerned with the behaviour of the CIC, so this wasn’t all that surprising………Full Article: Source

Bahrain SWF posts $183 mln loss in 2008

Posted on 29 July 2009 by VRS  |  Email |Print

From Reuters: Bahrain’s sovereign wealth fund Mumtalakat said on Tuesday it made a loss of $183 million in 2008, mainly on $981 million in impairment charges linked to investments in two Gulf Arab financial institutions.

“Impairment charges of 370 million dinars ($981.4 million) … were booked during the period leading to a net loss of 69.3 million dinars ($183.8 million) compared to a net income of 170 million dinars for 2007,” Mumtalakat said in a statement………Full Article: Source

SWF invests in Virgin Galactic

Posted on 29 July 2009 by VRS  |  Email |Print

From Abu Dhabi sovereign wealth fund Aabar Investments agreed on Tuesday to pay $280 million for a 32% stake in Virgin’s commercial space travel venture.

The deal makes Aabar the first outside investor in the venture that aims to open space travel to the public. Branson formed the unit in 2004 after aerospace pioneer Burt Rutan’s Scaled Composite’s won the Ansari X Prize by successfully sending SpaceShipOne and pilot Mike Melvill into space………Full Article: Source

Azerbaijan’s Oil Fund prefers to invest in Europe

Posted on 29 July 2009 by VRS  |  Email |Print

From The State Oil Fund of Azerbaijan (SOFAZ) has obvious investment tendency in favor of Europe.

SOFAZ executive director Shahmar Movsumov says that following the first half of the year 55.06% of Funds investment portfolio was placed in Europe, 28.11% in North America, and 13.79% fell to the share of international financial institutions………Full Article: Source

State Oil Fund of Azerbaijan claims it did not change regime of currency operations

Posted on 29 July 2009 by VRS  |  Email |Print

From The State Oil Fund of Azerbaijan has stated it cannot be blamed for possible shortage of foreign currency in exchange offices.

In its statement the Fund says it conducts currency operations in previous regime………Full Article: Source

Finmeccanica, Libya to set up Africa, Mideast venture

Posted on 29 July 2009 by VRS  |  Email |Print

From Reuters: Italy’s Finmeccanica and Libya’s sovereign wealth fund on Tuesday said they agreed to cooperate on aerospace and other projects in the Middle East and Africa, tapping into a market worth as much as $20 billion.

The deal is the latest tie-up between an Italian company and Libya, which has recently bought stakes in Italian companies like UniCredit and Eni and is now turning its focus to setting up joint ventures for projects in Libya and elsewhere………Full Article: Source

The Oxford survey of SWF’s asset managers

Posted on 29 July 2009 by VRS  |  Email |Print

From Sovereign wealth funds’ (SWF) operations and strategies remain, in many cases, guarded secrets.
While some confidentiality is understandable, a gap exists between what we’d like to know about SWFs and what most SWFs are willing to tell us………Full Article: Source

SWFs- Winners and losers

Posted on 29 July 2009 by VRS  |  Email |Print

From It’s been a rough year for private investors, but the huge sovereign wealth funds have found it just as hard.

About a year ago I wrote a piece on the power of Sovereign Wealth Funds (SWFs) — giant, state-controlled investment funds that were busily buying up businesses both here and abroad………Full Article: Source

Permanent fund director: reorganizing may boost check amounts

Posted on 29 July 2009 by VRS  |  Email |Print

From With uncertain economic conditions worldwide, the corporation that manages the Alaska Permanent Fund wants to explain its move to change how it makes investments.

It’s all in hopes of growing the fund — and the amount of dividend checks, which eligible Alaskans receive each fall………Full Article: Source

Who will be the next Temasek CEO?

Posted on 29 July 2009 by VRS  |  Email |Print

From Now that Temasek Holdings’ bid to hire a leader from outside the company has failed, the spotlight is turning to the possible candidates within.

Temasek watchers say one of them might be asked to step up to the plate in the future as the firm may find it harder now to recruit another CEO externally………Full Article: Source

Temasek: Residents call for greater transparency by Town Councils over use of sinking funds

Posted on 29 July 2009 by VRS  |  Email |Print

From In a recent dialogue on town council finance management organized by the Ministry of National Development, residents called on the town councils to be more transparent over the way the sinking funds are used.

Each town council has a sinking fund accumulated from the monthly S&C charges paid by residents. It is meant for long-term maintenance projects………Full Article: Source

Nigeria: Govs demand $4bln from Excess Crude

Posted on 29 July 2009 by VRS  |  Email |Print

From State governors are mounting intense pressure on the Federal Government to share at least $4 billion from the savings in the Excess Crude Account (ECA) among the three tiers of government.
The account, which was created by the government of ex-President Olusegun Obasanjo in 2003, is where the difference between budget benchmark price for oil and the actual market price is saved………Full Article: Source

China’s AgBank still in talks with strategic investors

Posted on 29 July 2009 by VRS  |  Email |Print

From Reuters: Central Huijin, the domestic investment arm of China’s sovereign wealth fund, now owns half of AgBank following a $19 billion capital injection in November 2008. The finance ministry owns the other half.

The bank’s assets totalled 8.48 trillion yuan ($1.24 trillion) by the end of June, versus liabilities of 8.16 trillion yuan………Full Article: Source

Banks grab $1 bln Middle East fee pot

Posted on 29 July 2009 by VRS  |  Email |Print

From WSJ: Dubai World, the state-owned property and investment group, is the largest fee-payer to investment banks in the Middle East and Africa, paying out $366 million in fees since 2004, according to data provider Dealogic.
The second-biggest fee payer is Abu Dhabi’s state-owned investor International Petroleum Investment Co., which has paid banks $245 million over the past five years………Full Article (Subscription Required) : Source

China’s oil partners hang onto assets

Posted on 29 July 2009 by VRS  |  Email |Print

From Beijing is considering setting up an oil stabilization fund to support purchases of overseas resources by Chinese oil companies.
The plan was submitted at NEA’s National Work Conference on Energy held in March 2009………Full Article: Source

Emerging nations need up to $900 bln reserves: IMF

Posted on 29 July 2009 by VRS  |  Email |Print

From Reuters: The International Monetary Fund on Tuesday estimated reserve needs of emerging countries, outside China and oil producers, could reach between $400 billion and $900 billion over the next five years as countries rebuild from the global financial crisis.

The IMF also said reserve needs of a group of 118 emerging market countries it sampled, excluding China and rich oil exporters, could be somewhere between $1.3 trillion and $2 trillion over the next 10 years………Full Article: Source

Temasek may hire internal candidate for Goodyear replacement

Posted on 28 July 2009 by VRS  |  Email |Print

From Bloomberg: Temasek Holdings Pte said it will consider promoting an internal manager after abandoning plans to make Charles “Chip” Goodyear the first foreign chief executive officer of Singapore’s state-owned investment fund.

“Temasek has in place a CEO succession planning process,” Temasek said in an e-mailed response to questions. “Our board reviews external and internal candidates over various time horizons.” ……….Full Article: Source

Kuwait wealth fund could exit mobile operator Zain

Posted on 28 July 2009 by VRS  |  Email |Print

From The largest shareholder in Zain, the Kuwaiti mobile operator recently listed as a possible acquisition target by Etisalat, is reportedly open to selling its 25 per cent share in the company.

A report in Al Rai, a Kuwaiti daily newspaper, quoted anonymous sources in the Kuwait Investment Authority (KIA) as saying the sovereign wealth fund would consider such a sale at the right valuation………..Full Article: Source

Mumtalakat banks on transparency

Posted on 28 July 2009 by VRS  |  Email |Print

From After publishing its second set of annual results last week, and with an international rating on the way, Bahrain Mumtalakat Holding Company seems determined to earn a reputation as the most transparent sovereign wealth fund in the Gulf.
“Unlike most of the funds in the region, we do not get our income from oil revenues,” says Talal Al Zain, chief executive………..Full Article: Source

Fund members still too disengaged

Posted on 28 July 2009 by VRS  |  Email |Print

From Australian superannuation fund members have not been unduly panicked by the investment losses generated by the global financial crisis, according to a survey conducted by the Industry Super Network (ISN).

The survey found rather than becoming overly worried by the decline in their superannuation balances, fund members have been more focused on issues such as the general economic conditions and their job security………..Full Article: Source

SWFs still seen as political creatures

Posted on 28 July 2009 by VRS  |  Email |Print

From The official line why Charles “Chip” Goodyear will not become chief executive of Temasek Holdings as planned is that the American executive and the board of the giant Singapore investment fund did not quite see eye-to-eye on strategy.
If that’s the case, it’s hard to understand why it took them five months to discover the yawning gulf between them………..Full Article: Source

Wealthy Qatar gets 17% stake after Porsche takeover deal

Posted on 28 July 2009 by VRS  |  Email |Print

From Qatar used its $63bn sovereign wealth fund to give the world’s second-richest country behind Liechtenstein investment clout, snapping up stakes in established brands or troubled companies in need of cash.

Four years after its inception, the fund has become the biggest shareholder in Barclays, J Sainsbury and Credit Suisse………..Full Article: Source

Saudi pension fund raises stakes in listed firms

Posted on 28 July 2009 by VRS  |  Email |Print

From Reuters: The General Organisation for Social Insurance (GOSI), Saudi Arabia’s largest pension fund, has raised stakes in six listed firms, including Saudi Telecom 7010.SE and Savola Group 2050.SE, official data showed on Monday.

The state-owned GOSI increased its stake in state-controlled Saudi Telecom on Sunday to 7 percent from 6.9 percent, according to the data published on the stock exchange’s website………..Full Article: Source

Norway examines the ethics of its Israel investments

Posted on 28 July 2009 by VRS  |  Email |Print

From The Council on Ethics was established to insure that foreign investments by the Norwegian Government Pension Fund-Global meet its ethical guidelines.
At the end of 2008, the fund was invested in about 8,000 international companies, to the tune of 2,275 billion kroner, approximately $365 billion, according to this week’s exchange rate………..Full Article: Source

Norway fund eyes India for better returns

Posted on 28 July 2009 by VRS  |  Email |Print

From Norway’s Government Pension Fund (Global) — where the surplus wealth produced by Norwegian petroleum income is deposited — has exposure to around 215 Indian listed companies.
According to an official of Norges Bank Investment Management, which is responsible for investing the international assets of the fund, emerging markets such as India have been ‘responsible for improvement in the returns’ clocked by international listed stocks portfolio………..Full Article: Source

British trade minister returns to China with new mission

Posted on 28 July 2009 by VRS  |  Email |Print

From Telegraph: China’s enormous sovereign wealth funds have invested heavily in UK-listed companies and continue to invest; last week, China Investment Corporation took a 1pc share in Diageo for £221m.

However, there seems little desire among Chinese companies to expand operations into Britain. The Government boasts that China is now one of Britain’s top 10 foreign investors, but Chinese companies created a mere 607 jobs in the UK last year………..Full Article: Source

July 2009
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