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Sovereign Wealth Funds Briefing - Archive | June, 2014

Chinese sovereign wealth fund mismanaged investments

Posted on 19 June 2014 by VRS  |  Email |Print

China Investment Corp failed to conduct adequate due diligence on overseas investments which led to losses, the mainland’s auditor finds. The mainland’s US$575 billion sovereign wealth fund mismanaged some of its overseas investments between 2008 and last year that led to losses, the National Audit Office said yesterday without specifying the size of the loss.
It said some employees of China Investment Corp (CIC) did not conduct adequate due diligence before investing in 12 overseas projects in the past six years. And they subsequently also failed to track the performance of those investments, it said………………………………….Full Article: Source

Auditor blames CIC

Posted on 19 June 2014 by VRS  |  Email |Print

Mismanagement at China Investment Corp, the nation’s US$575 billion sovereign wealth fund, led to overseas investment losses that could widen, according to the National Audit Office.
A dereliction of duty by managers and inadequate due diligence and post- investment management were identified in 12 investments made abroad by the fund between 2008 and 2013, according to results of an audit conducted last year. Six of the deals were unprofitable, four of them had unrealized losses, and two may potentially lose money. The report released yesterday did not name the investments or disclose their size………………………………….Full Article: Source

China Audit Found Irregularities at Wealth Fund, Two State Banks

Posted on 19 June 2014 by VRS  |  Email |Print

China’s government auditing agency said Wednesday that last year it found financial irregularities at two big state banks and the nation’s sovereign-wealth fund and that all three need to tighten their management.
The National Audit Office said it had uncovered management failures related to investments at China Investment Corp., the country’s sovereign-wealth fund, as well as irregular lending at Bank of China Ltd and Agricultural Development Bank of China.The auditor said that CIC and the state banks had largely addressed the problems as of May………………………………….Full Article: Source

CIO defends KIC over stigma of Merrill losses

Posted on 19 June 2014 by VRS  |  Email |Print

The new CIO of Korea Investment Corporation has leapt to the sovereign fund’s defence, decrying the negative stigma attached to its loss-making investment in Merrill Lynch as unrepresentative of its achievements.
Choo Heung Sik praised KIC’s performance since it started international investment in 2006 as phenomenal.”KIC began from scratch; no one helped us,”said Choo, referencing Singapore’s sovereign wealth fund GIC, which enjoyed a three-year incubation period with support from the Monetary Authority of Singapore………………………………….Full Article: Source

CCI gives green signal to Amex-Qatar Holding joint venture

Posted on 19 June 2014 by VRS  |  Email |Print

Fair trade watchdog CCI has approved the proposed joint venture between American Express and Juweel Investors, part of sovereign wealth fund Qatar Holding, saying the deal is unlikely to have an adverse impact on competition in India.
Under the deal, American Express’ global business travel services, which also has India presence, would be transferred to the new joint venture — GBT III B V. The joint venture is between American Express and Juweel — a special purpose vehicle set up by Qatar Holding and certain other investors. “The Commission is of the opinion that the proposed combination is not likely to have an appreciable adverse effect on competition in India,” CCI said in an order………………………………….Full Article: Source

Caltex and Goodman attract close scrutiny for block trades

Posted on 19 June 2014 by VRS  |  Email |Print

The largest shareholders of oil refiner Caltex and property developer Goodman Group are under close scrutiny for potential block trades worth a collective $3.8 billion after Shell’s $6.1bn exit from Woodside Petroleum this week.
Should sovereign wealth fund China Investment Corporation and energy giant Chevron exit Goodman Group and Caltex, they will follow Royal Dutch Shell’s selldown of its 19 per cent stake in Woodside Petroleum on Tuesday, $3.2bn of which was subject to a block trade………………………………….Full Article: Source

Batista seeks Mubadala refinancing after Óleo success, sources say

Posted on 19 June 2014 by VRS  |  Email |Print

The successful restructuring of bankrupt oil producer Óleo e Gás Participações SA will allow Brazilian tycoon Eike Batista to move forward with plans to cut his own debt, three sources with direct knowledge of the situation said.
Batista and his EBX holding company have been in talks to renegotiate about $2 billion owed to Abu Dhabi sovereign wealth fund Mubadala Development Co PJSC, the sources said. Batista may offer assets, including stakes in firms he either controls or has a stake in, to speed up the process, they said………………………………….Full Article: Source

Nigeria: ECA rises to N3.73bn as govts share N648.349bn in May

Posted on 19 June 2014 by VRS  |  Email |Print

Federal Government announced N3.73 billion as the balance in the Excess Crude Account saying that the amount rose from N3.6 billion in April to the level in May. Addressing newsmen in Abuja, the Accountant General of the Federation, Mr Jonah Otunla, also revealed N648.349 billion was the total allocation shared by the three ters of government.
The amount represented N582.934 billion Statutory Allocation and N65.415 billion realised from the Value Added Tax (VAT), making the total distributable revenue for the month to be N648.349 billion which when compared to last month, is N49.177 billion higher, adding that the total allocation to SURE-P as ususaI, is N35.55 billion………………………………….Full Article: Source

Are Sophisticated Sovereign Wealth Funds Becoming the Next Crop of Dealmakers?

Posted on 19 June 2014 by VRS  |  Email |Print

Sovereign funds represent a large, thriving pool of sophisticated capital. With nearly US$ 7 trillion in institutional investor assets, sovereign wealth funds have flexed their muscles, acquiring luxury hotels to Indian movie production companies.
Year over year, more sovereign wealth funds are doing direct deals and participating in co-investments with private equity funds, mega pensions and specialist funds………………………………….Full Article: Source

China’s sovereign wealth fund shifts focus to agriculture

Posted on 18 June 2014 by VRS  |  Email |Print

China’s sovereign wealth fund is shifting its focus to invest in agriculture and global food supplies in a significant strategic move that reflects the priorities of the country’s new leadership.
In an opinion piece in the Financial Times, Ding Xuedong, chairman of China Investment Corp, said the country’s $650bn sovereign wealth fund wants to invest more in agriculture around the world and “across the entire value chain”………………………………………..Full Article: Source

NZ Super names new CIO

Posted on 18 June 2014 by VRS  |  Email |Print

The New Zealand Superannuation Fund (NZ Super) has named Matt Whineray as its new chief investment officer. Whineray has been with NZ Super since 2008 in the role of general manager, investments.
Prior to that he was a head of financial sponsor coverage for non-Japan Asia at Credit Suisse, based in Hong Kong. Before that he was a director at First NZ Capital in New Zealand………………………………………..Full Article: Source

Korea sovereign fund looks to lift Australian investments

Posted on 18 June 2014 by VRS  |  Email |Print

Australian infrastructure and real estate investment will be a target for South Korea’s $US405 billion ($433.4 billion) sovereign pension fund over the next five years as the fund significantly cranks up its offshore investments.
The head of investment strategy at the National Pension Service (NPS), Yoon Pyo Lee, said the fund planned to lift its total offshore investments by $US159 billion to $US237 billion over the next five years. NPS is the fourth-biggest sovereign pension fund in the world. More importantly it sets the investment allocation benchmark for all other large pension funds in Korea……………………………………….Full Article: Source

What should China buy with its $3.9 trillion reserves?

Posted on 18 June 2014 by VRS  |  Email |Print

China’s foreign exchange reserves rose to $3.948 trillion at the end of the first quarter. The figure in 1978 was $167 million, and in November 1996 it surpassed $100 billion for the first time. The change has been amazing.
There have been many thoughts about how we in China can make use of the forex reserve, ranging from buying assets abroad to using it as leverage in diplomatic talks. What needs emphasizing is that the reserve is not a free buffet. It corresponds to the central bank’s debt in yuan and costs dearly to maintain………………………………………..Full Article: Source

How the ‘Deal-Hunter’ Qatar Investment Authority Became Introverted

Posted on 18 June 2014 by VRS  |  Email |Print

The Qatar Investment Authority (QIA)’s asset allocation behaviors are becoming more conservative to fall in line with the nation’s economic development agenda and stronger presence in the region, according to GeoEconomica. The Geneva-based political risk management firm said the once “aggressive deal hunting” sovereign wealth fund—guided by former CEO Sheikh Hamad bin Jassim bin Jaber al-Thani—had been less active during the past few months, passing on opportunities such as Deutsche Bank’s recent capital increase.
“The modi operandi of most sovereign wealth funds, in one way or another, mirror the political cultures and ambitions of the governments that own them,” the report said. “Qatar’s international position has most recently come under significant pressure and the Doha has to deliver on a massive economic development program over the coming decade.”……………………………………….Full Article: Source

POSCO to Work with Saudi SWF to Build Auto Assembly Plant

Posted on 18 June 2014 by VRS  |  Email |Print

POSCO Group, jointly with the Public Investment Fund of Saudi Arabia, will build an automobile assembly plant in Saudi Arabia with an annual capacity of 150,000 cars. The group will also cooperate actively with construction projects to build social infrastructures such as homes and plants.
According to company sources on June 17, POSCO chairman Kwon Oh-joon met on the 13rd with Abdulrahman M. Al Mofadhi, Acting Secretary General of the Saudi sovereign wealth fund and signed an agreement for mutual cooperation. Earlier in February he had discussed with Mr. Al Mofadhi before being appointed as POSCO chairman for a possible deal to build an auto plant………………………………………..Full Article: Source

ECA rises to N3.73bn as govts share N648.349bn in May

Posted on 18 June 2014 by VRS  |  Email |Print

Federal Government announced N3.73 billion as the balance in the Excess Crude Account saying that the amount rose from N3.6 billion in April to the level in May. Addressing newsmen in Abuja, the Accountant General of the Federation, Mr Jonah Otunla, also revealed N648.349 billion was the total allocation shared by the three ters of government.
The amount represented N582.934 billion Statutory Allocation and N65.415 billion realised from the Value Added Tax (VAT), making the total distributable revenue for the month to be N648.349 billion which when compared to last month, is N49.177 billion higher, adding that the total allocation to SURE-P as ususaI, is N35.55 billion………………………………………..Full Article: Source

The Nigerian SWF

Posted on 18 June 2014 by VRS  |  Email |Print

Sovereign Wealth Funds (SWF) are state-owned investment funds typically (though not exclusively) funded through revenues from commodity exports or foreign exchange reserves held by central banks which invest in real and financial assets-stocks, bonds, real estate, infrastructure, precious metals or alternative investments such as private equity and hedge funds.
The term “sovereign wealth fund” was reportedly first used in 2005 by one Andrew Rozanov in an article titled, “Who Holds the Wealth of Nations?” in Central Banking Journal, even though such funds have existed for over a century. The number of SWFs has however dramatically increased in the 2000s………………………………………..Full Article: Source

Expanding SWF forum to fly IMF nest and land in London next month

Posted on 18 June 2014 by VRS  |  Email |Print

Sovereign wealth funds (SWFs) from Nigeria and Russia last month became the 27th and 28th members of the International Forum of Sovereign Wealth Funds (IFSWF) – and the global network is expecting its ranks to continue swelling once its secretariat moves to London at the start of next month.
Kristian Flyvholm, secretary-general designate of the forum, which has been hosted at the International Monetary Fund (IMF) since its establishment in 2009, said today it has a “very strong number of potential members who want to become full members”, adding he is “quite sure each quarter you’re going to have one or two new members joining”………………………………………..Full Article: Source

Private markets, public investors: The march of the sovereigns

Posted on 18 June 2014 by VRS  |  Email |Print

Sovereign wealth funds, typically set up by oil-exporting nations, have been around for decades, in the case of Kuwait since 1953. But their influence has increased in recent years, as China has adopted a similar strategy for investing some of its vast foreign-exchange reserves while existing funds have been fuelled by gains from high oil prices.
However, a new survey of assets held by public investors shows that such wealth funds are still outpunched by more traditional players. Central banks are the biggest holders of assets, followed by public pension funds, with sovereign wealth funds coming third………………………………………..Full Article: Source

Debate continues over PNG’s Sovereign Wealth Fund

Posted on 17 June 2014 by VRS  |  Email |Print

Debate over PNG’s Sovereign Wealth Fund continues even though the first shipment of liquefied natural gas has been delivered to Japan. The purpose of the Fund is to control the spending of the considerable revenue generated by the PNG LNG project.
Disputes over the best fomat for the Fund and procedural mistakes when passing the establishing legislation in 2011 are the reasons the Fund has not been set up………………………………………..Full Article: Source

The world’s biggest sovereign wealth fund is set to reshape the FTSE 100

Posted on 17 June 2014 by VRS  |  Email |Print

Times are changing for one of the world’s biggest sovereign wealth fund. The Qatar Investment Authority (QIA), the $175bn behemoth which invests money on behalf of the Qatari state, is expected to dampen its more ambitious dealmaking.
It will instead adopt an increasingly “conservative” approach, according to a research note published today by political strategists Geoeconomica. “It should be expected that the Qatari Government will be much less likely to use QIA’s capital to advance its network-based foreign policy approach, although the Government might want to consolidate its existing relationships rather than reverse them. But overall, the expectation is that QIA become a more conservative, less politically oriented and more strategic investment entity,” it said………………………………………..Full Article: Source

Abu Dhabi’s Mubadala In Talks To Cut Debt Owed by Eike Batista

Posted on 17 June 2014 by VRS  |  Email |Print

The biggest investor in Brazilian businessman Eike Batista’s holding company is still struggling to reduce its exposure to the troubled industrial group. Mubadala Development Co., Abu Dhabi’s sovereign-wealth fund, on Monday confirmed that it continues to negotiate ways to reduce debt that it is owed by the Brazilian businessman, a process that started last year.
“Discussions are continuing,” Brian Lott, the executive director of Group Communications at Mubadala, said in a telephone interview. “Mubadala continues to look for strategic assets and opportunities that align with our portfolio,” he added without providing further details………………………………………..Full Article: Source

Qatar SWF Drops Flashy Deals as Foreign Policy Shifts, Report Says

Posted on 17 June 2014 by VRS  |  Email |Print

The Qatar Investment Authority, Qatar’s main sovereign wealth fund, appears to be shunning the flashy deal-making of its past in favor of a more conservative approach, in line with a shift in the country’s foreign policy away from high-visibility regional diplomacy, according to a recent report by GeoEconomica, a Geneva-based political risk advisory firm.
Estimated to have about $175 billion under management, the QIA has long been one of the Middle East’s biggest and most aggressive investment pools………………………………………..Full Article: Source

CBRE: Middle East SWFs To Spend $180 Billion on Real Estate Abroad

Posted on 17 June 2014 by VRS  |  Email |Print

Middle Eastern investors are expected to spend $180 billion on buying commercial property outside their own region over the next 10 years, according to new research from property advisor CBRE. A significant chunk of that investment – roughly $130-$140 billion – is expected to come from regional sovereign wealth funds, while investors, property companies and developers will account for the remaining amount, said CBRE.
Europe is the preferred target and is expected to receive 80 per cent of the $180 billion (around $145 billion) as it offers “diversification, cultural acceptance, high liquidity and market transparency,” said the report. While close to $85 billion will flow into the UK, $60 billion will be invested in continental Europe, with France, Germany, Italy and Spain among the key target markets………………………………………..Full Article: Source

Why do Gulf sovereign funds not invest in Egypt?

Posted on 17 June 2014 by VRS  |  Email |Print

The Gulf’s support for the Egyptian economy after the dismissal of former President Mohamed Morsi on July 3, 2013, has taken several forms including bank deposits into the Central Bank of Egypt, petroleum derivatives, long-term loans and non-refundable grants. Initially it was announced that the size of this support was $12 billion.
However, during his presidential campaign Al-Sisi told the media that this support reached more than $20 billion in just 10 months. This support rescued many economic indicators of Egypt, such as that seen in the stability of the foreign exchange reserves at $17.2 billion at the end of May 2014, and the relative maintenance of the price of the Egyptian pound from a dramatic collapse………………………………………..Full Article: Source

GCC states spread the wealth around

Posted on 16 June 2014 by VRS  |  Email |Print

The Gulf Cooperation Council (GCC) maintains a quite substantial sovereign wealth funds (SWFs), and much to their credit, they invest these across a wide global footprint. In fact, they have a track record of showing readiness to contribute handsomely to solve critical global financial problems. This was put to display at the height of sub-prime market crisis in 2008, with the GCC contributing generously to a special fund to help those hit with the calamity.
Three other GCC member-states maintain sizeable SWFs, specifically $743 billion for Saudi Arabia, $410 billion for Kuwait and $170 billion for Qatar. Oman and Bahrain maintain relatively smaller — by regional standards — funds of $19 billion and $11 billion………………………………………..Full Article: Source

ChrysCapital-GIC team emerges as front-runner in race to buy Destimoney from New Silk Route

Posted on 16 June 2014 by VRS  |  Email |Print

A consortium of private equity fund ChrysCapital and Singapore government’s sovereign wealth fund GIC has emerged as the front-runner to purchase growth capital fund New Silk Route’s (NSR) 100% stake in retail financial services and distribution company Destimoney.
“ChrysCapital has teamed up with GIC to bid for the financial services company. They seem to have gained a clear edge over rival bidders,” said a person directly involved with the transaction………………………………………..Full Article: Source

Future Fund appoints Managing Director

Posted on 16 June 2014 by VRS  |  Email |Print

Future Fund board chairman, Peter Costello believes David Neal, the fund’s current chief investment officer, is the best qualified person for the managing director’s role. The former Federal Treasurer announced that Neal will takeover from interim managing director, and chief financial officer, Paul Mann, as head of the $100 billion sovereign wealth fund in August following an extensive global search for the ideal candidate.
Costello said the search process confirmed that Neal was the best qualified candiate for the position………………………………………..Full Article: Source

Khazanah raises more questions for Malaysia

Posted on 16 June 2014 by VRS  |  Email |Print

Can anybody please explain to me quite why the country’s flagship sovereign wealth fund Khazanah Nasional pulled a US$500m exchangeable sukuk transaction the week before last, when the deal looked as tickety-boo in execution as any equity-linked deal you’re likely to cast eyes on?
The book was covered, and more than 50 top end investors had circled orders, but apparently Khazanah’s treasurers found their inability to print at the finest of margins irksome and so they pulled the trade. They missed the chance to bring a deal in decent size in a market where global equity indices were printing record highs and at spreads that might not be revisited for a while………………………………………..Full Article: Source

Japan readies to unshackle huge pension fund

Posted on 16 June 2014 by VRS  |  Email |Print

Japan’s government is readying to unfetter its huge public pension fund, freeing managers to dump low-yield sovereign bonds and go in search of higher, but riskier returns, in a move that could see cash flood global markets. The nation’s pension programme, into which almost all citizens pay, is supported by the world’s largest investment fund, worth a staggering USD 1.26 trillion equivalent to one-quarter of the country’s entire economy.
It towers over its nearest competitor, the USD 700 billion belonging to Norway — and is multiples of the USD 173 billion holdings of Temasek, the Singaporean sovereign wealth fund………………………………………..Full Article: Source

Azerbaijan’s sovereign wealth fund to invest $1.8 billion in renminbi

Posted on 16 June 2014 by VRS  |  Email |Print

Azerbaijan’s sovereign wealth fund will invest up to $1.8 billion in China’s renminbi this year, one of the biggest publicly-acknowledged investments in China’s currency. Shahmar Movsumov, the chief executive of the $37 billion State Oil Fund of Azerbaijan, said that the fund is applying for permission from Chinese regulators to access local currency assets and wants to start investing in them by the end of this year.
“It’s one of the currencies that are becoming important, so why not invest in renminbi?” Movsumov said, according to the Financial Times. “We are in the process of getting all the necessary preparations.”……………………………………….Full Article: Source

Gulf SWFs part of Samena Capital-led group buying RAK Ceramics stake

Posted on 16 June 2014 by VRS  |  Email |Print

Samena Capital and a group of international investors including two Gulf sovereign wealth funds have completed the purchase of a 30.6 per cent stake in Ras Al Khaimah Ceramics, the investment firm said in a statement on Sunday. The fund, acting through Cayman Islands-registered subsidiary Samena Limestone Holdings, will have two seats on the board of one of the world’s biggest makers of floor tiles, following the acquisition.
The statement did not name the other investors in the consortium. But in a separate bourse filing, RAK Ceramics said it had amended its rules so citizens of Gulf Cooperation Council (GCC) states were treated as equivalent to UAE shareholders — suggesting the investors come from outside the UAE………………………………………..Full Article: Source

NSIA Joins Int’l Sovereign Wealth Funds Forum

Posted on 16 June 2014 by VRS  |  Email |Print

The Nigeria Sovereign Investment Authority (NSIA) has been admitted into the International Forum of Sovereign Wealth Funds - IFSWF. A statement on Thursday, said the NSIA was admitted by the IFSWF at its board meeting of May 28, 2014, “based on your proven willingness to endorse, on a voluntary basis, the Santiago Principles.”
The IFSWF, a voluntary group of Sovereign Wealth Funds (SWFs), was established by the International Working Group of Sovereign Wealth Funds in April 2009, to among others promote “understanding of the Santiago Principles - a set of 24 guidelines for the operation of SWFs.”……………………………………….Full Article: Source

Former CIC stock picker Yu Bin plans China fund

Posted on 13 June 2014 by VRS  |  Email |Print

Yu Bin, a former managing director at China’s sovereign wealth fund, plans to start a fund focused on China equities, sources said. Yu resigned from Beijing-based China Investment Corp (CIC) earlier this year for personal reasons, they said. He will remain based in China and his long-biased fund will primarily bet on stocks whose prices are expected to rise, they said.
Institutional investors globally have been scouting for China-based managers with international experience, who can pick stocks set to benefit from growth in the world’s second-largest economy and do not charge hedge-fund fees that are typically higher………………………………………..Full Article: Source

Japan’s Meiji buying Temasek-backed drugmaker Medreich for $290M

Posted on 13 June 2014 by VRS  |  Email |Print

Meiji Seika Pharma, a part of Meiji Holdings Co. Ltd, has signed a deal to acquire Medreich Ltd, a Bangalore-based contract manufacturing pharmaceutical company, for $290 million (Rs 1,720 crore). This acquisition will also mark an exit for Singapore’s sovereign fund Temasek, which had invested in the company way back in 2005.
One source said Temasek held close to 33 per cent in Medreich, which it had picked through an allotment nine years ago for around Rs 112 crore ($25 million). This means it is exiting with 5.1x in local currency and 3.9x in dollar terms in its nine-year-old bet on the firm………………………………………..Full Article: Source

Billions at risk if tax act amended to allow investment panel, says PKR lawmaker

Posted on 13 June 2014 by VRS  |  Email |Print

Billions of taxpayers’ money are at risk of being used to buy stocks, bonds, debts and properties under a proposed amendment to a tax law allowing for an investment panel that could be as secretive as 1MDB, PKR lawmaker Wong Chen (PKR- Kelana Jaya) said.
“What if our tax money is used to buy shares to support and prop up a crony company? What if the investment panel decides to support the opaque and questionable 1MDB listing?” he said in referring to state-owned sovereign fund which is planning to raise US$4.6 billion (RM15 billion) through an initial public offering of its power-generation assets………………………………………..Full Article: Source

Japan’s Nomura launches Dubai office as business grows

Posted on 13 June 2014 by VRS  |  Email |Print

Japanese fund manager Nomura Asset Management has launched an office in Dubai International Financial Centre (DIFC) after its business in the region more than doubled in the past five years.
The Japan-based global asset manager has been managing sovereign wealth fund assets for over 25 years and globally it has $291 billion of assets under management………………………………………..Full Article: Source

SWFs rushing to invest in India

Posted on 13 June 2014 by VRS  |  Email |Print

Several sovereign wealth funds (SWF) and overseas pension funds are rushing to invest in India, driven by hopes of economic recovery under a new stable government. At least three sovereign funds from West Asia have invested over $5 billion in the past eight months and one global pension fund has committed to invest $450 million.
Two other funds are scouting for investments in India’s real estate and infrastructure developers. “Risk of returns are out of the way and these funds can invest capital for longer tenure,” said the head of a realty fund, which has received investments from two SWFs in West Asia. Private equity (PE) experts say a trend is visible of both SWF and pension funds investing heavily in the past six months………………………………………..Full Article: Source

Oil fund may profit from Thai prawn slavery

Posted on 13 June 2014 by VRS  |  Email |Print

Norway’s oil fund may be forced to divest its 250m kroner stake in the Thai food company CP Foods, after the UK’s Guardian newspaper reported that the company sources prawns from ships that employ slave labour.
According to Norway’s Aftenposten newspaper, the Government Pension Fund of Norway, as the oil fund is known, holds a 0.54 percent stake in the company, making it one of the largest international shareholders………………………………………..Full Article: Source

Zimbabwe: Norway Pledges to Share Expertise

Posted on 13 June 2014 by VRS  |  Email |Print

Norway’s Ambassador to Harare Mr Bard Hopland said: “We discussed also, in general, Norwegian experience within the area of natural resources management and management of revenue from natural resources, the Sovereign Wealth Fund, as you may know.”
“If you might know, we have already provided experts in this field who were here in March and participated in the parliamentary seminar on Zim-Asset and we will also continue to discuss with the Minister of Finance how we could follow up on the issue of natural resources management and the Norwegian experience in that regard.”……………………………………….Full Article: Source

Alaska Permanent Fund plans more housing, infrastructure

Posted on 12 June 2014 by VRS  |  Email |Print

Alaska Permanent Fund Corporation is planning to invest $400m (€296m) in infrastructure and $160m in single-family homes in the US. The pension fund has launched its third joint venture with American Homes 4 Rent, providing 80% of the $200m capital to invest in rented accommodation.
The Permanent Fund provided $400m and $200m for two previous partnerships in 2012. Michael Burns, executive director for the pension fund, said: “We have been pleased with the results we have had with American Homes up to this point………………………………………..Full Article: Source

Russian National Welfare Fund assets may be invested in gas pipeline to China

Posted on 12 June 2014 by VRS  |  Email |Print

Russia’s National Welfare Fund assets may be invested in the construction of a gas pipeline to China, Minister of Economic Development Alexei Ulyukayev said on Wednesday, June 11. “This is probably not a net increase in the authorized capital of Gazprom but this may be a contribution to an SPV [special purpose vehicle] to be created by Gazprom,” he said.
National Welfare Fund’s assets can already be invested in preferred stock. “We have already made the decision to make a contribution to Russian Railways’ capital,” he added………………………………………..Full Article: Source

Fondo Italiano di Investimento makes first exit with Eco Eridania sale

Posted on 12 June 2014 by VRS  |  Email |Print

Italian sovereign wealth fund Fondo Italiano di Investimento has sealed its first divestment by selling its stake in waste management business Eco Eridania to fellow backers including Xenon Private Equity.
FII picked up a minority stake in the business for €10m in 2011, with Xenon coming on-board through a €14.3m financing alongside FSI in November 2012. Eco Eridania was launched in 1988 as an environmental services and consultancy company, and has since altered its business to specialise in disposing of animal and vegetable waste and hazardous materials from hospitals………………………………………..Full Article: Source

Azerbaijan sovereign wealth fund eyes renminbi-denominated assets

Posted on 12 June 2014 by VRS  |  Email |Print

The State Oil Fund of Azerbaijan intends to begin buying renminbi-denominated assets by the end of the year, subject to approval from Chinese regulators, Shahmar Movsumov, chief executive of the $37bn sovereign wealth fund, has said.
The move is part of a strategy the fund finalised at the end of last year to diversify beyond its traditional holdings of dollar- and euro-denominated fixed income, by boosting exposure to currencies other than the greenback, euro and pound from 5% to 10%, Movsumov told the Financial Times………………………………………..Full Article: Source

Azerbaijan Invests Big in CNY Assets

Posted on 12 June 2014 by VRS  |  Email |Print

Azerbaijani sovereign wealth fund planned to invest at most USD 1.8 billion in CNY assets in 2014, being one of the biggest open investments in CNY assets.
CEO of State Oil Fund worth USD 37 billion revealed that the fund is applying to Chinese government regulators for license to buy CNY assets. Investment will be started by the end of 2014 at the latest. The fund will use all the money it has this year to invest in CNY assets………………………………………..Full Article: Source

Indonesian coal miner Bumi gets lender approval for CIC deal

Posted on 12 June 2014 by VRS  |  Email |Print

Indonesian coal miner PT Bumi Resources said on Wednesday its lenders had agreed to close a crucial debt-to-equity swap with Chinese sovereign wealth fund CIC, enabling it to pay the coupon on its 2016 bonds.
In October, CIC agreed to convert the $1.3 billion debt it was owed by Bumi Resources into stakes in the Indonesian company and associated subsidiaries………………………………………..Full Article: Source

Former CIC stock picker Yu Bin plans China fund, sources say

Posted on 12 June 2014 by VRS  |  Email |Print

Yu Bin, a former managing director at China’s sovereign wealth fund, plans to start a fund focused on China equities, sources said. Yu resigned from Beijing-based China Investment Corp (CIC) earlier this year for personal reasons, they said. He will remain based in China and his long-biased fund will primarily bet on stocks whose prices are expected to rise, they said.
Institutional investors globally have been scouting for China-based managers with international experience, who can pick stocks set to benefit from growth in the world’s second-largest economy and do not charge hedge-fund fees that are typically higher………………………………………..Full Article: Source

Norway fund RM2.15 TRILLION, Malaysia’s RM12.67 billion: Nurul calls for set-up of transparency panel to oversee O&G wealth

Posted on 12 June 2014 by VRS  |  Email |Print

The Prime Minister Should Adopt A Malaysian Extractive Industries Transparency Initiative (EITI) For Better Oversight and Governance Over Petroleum Revenues. For example, whilst 1 Malaysia Development Berhad (1MDB)’s RM5.8 billion loan is guaranteed by the government, the fund – formerly a sovereign wealth fund called the Terengganu Investment Authority set up in 2008 and backed by petroleum royalties due to the state from the Federal government - lacks the transparency and disclosure mechanisms necessary to generate and develop public confidence in its management.
Norway is one such country, having set up the Government Pension Fund – Global (previously known as The Petroleum Fund of Norway) in 1990 into which surplus wealth from petroleum income was to be deposited in order to counter the effects of an anticipated decline in income………………………………………..Full Article: Source

SWFs: A race worth joining to unlock Africa’s hidden potential?

Posted on 12 June 2014 by VRS  |  Email |Print

Africa has experienced a rise in the establishment of sovereign wealth funds (SWFs) over the past decade. The Sovereign Wealth Fund Institute, a United States (US)-based research organisation, defines the term sovereign wealth fund as “a state-owned investment fund or entity” often set up from balance of payments surpluses, official foreign currency operations, privatisation proceeds, government transfer payments, fiscal surpluses and receipts from resource exports.
SWFs can be based on either commodities or non-commodities. Commodities-based SWFs are established from revenue derived from commodity exports, which are owned or taxed by the government. Non-commodities based SWFs are established from revenue raised through, for example, the transfer of assets from official foreign reserves………………………………………..Full Article: Source

Saudi’s Shoura Council Debates Sovereign Wealth Fund Plan

Posted on 12 June 2014 by VRS  |  Email |Print

A proposal to set up a Saudi Arabian sovereign wealth fund attracted debate at a meeting of the Kingdom’s influential Shura council advisory body but failed to yield a result. A report by the council’s financial committee has said the National Reserve Fund, which would invest part of the Kingdom’s vast hydrocarbon wealth, would build on its financial stability.
Details of its investment strategy have yet to be disclosed publicly, but if the proposed fund is run like the sovereign wealth funds of other wealthy Gulf states such as Qatar and Abu Dhabi, it could mean a change in the way Saudi money flows through global markets………………………………………..Full Article: Source

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