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Sovereign Wealth Funds Briefing - Archive | November, 2014

Temasek, Winklevoss invest in US start-up which predicts outcome of legislation

Posted on 21 November 2014 by VRS  |  Email |Print

Temasek Holdings has invested in a Washington-based start-up which uses artificial intelligence to predict the outcome of legislation. According to The Washington Post, FiscalNote has closed a US$7 million round of funding from a raft of big names, including the Singapore sovereign wealth fund and the Winklevoss twins, famous for their lawsuits against Facebook and its founder, Mark Zuckerberg.
FiscalNote, founded by a Potomac entrepreneur, uses data-mining software and artificial intelligence to predict the fate of Bills proposed by state legislatures and Congress each year. The company claims 94 per cent accuracy………………………………….Full Article: Source

Reverse Logistics may raise $125 million, step into new markets

Posted on 21 November 2014 by VRS  |  Email |Print

Refurbished goods retailer Reverse Logistics Corps, which owns and operates GreenDust.com, is in talks with global hedge funds and wealth funds to raise about $125 million (Rs 772 crore) in another round of funding. Among those the Delhi-based company is talking to for Series B capital are Temasek, the sovereign investment arm of the government of Singapore, and hedge fund Falcon Edge Capital, according to two persons privy to the development.
Separately, two Middle Eastbased sovereign funds and a Far East-based family office are also believed to be in the running to buy a stake in GreenDust, a transaction that could potentially value the company at between $375 million (Rs. 2,300 crore) and $400 million (Rs 2,470 crore). GreenDust founder Hitendra Chaturvedi and Temasek spokesperson Stephen Foreshaw declined to comment on the developments. An email query sent to Falcon Edge Capital remained unanswered till as of press time. …………………………………Full Article: Source

Future Fund invests in fossil fuels but not tobacco

Posted on 21 November 2014 by VRS  |  Email |Print

Former treasurer Peter Costello has defended the Future Fund’s investment decisions during a sometimes feisty Senate estimates hearing in Canberra. Mr Costello, who is the chairman of the fund, was questioned about why the fund continued to invest in fossil fuels given its decision to stop investing in tobacco companies.
Mr Costello said the fund concluded that no amount of tobacco was safe and its decision to divest those shares would not affect other investment decisions.”I think it would be extraordinary if the government of Australia in its sovereign wealth fund said it was going to pull out of coal or gas or oil,” he said………………………………….Full Article: Source

Alaska Permanent Fund posts -1.2% return for quarter

Posted on 21 November 2014 by VRS  |  Email |Print

Alaska Permanent Fund Corp., Juneau, returned -1.2% for the quarter ended Sept. 30, slightly above its benchmark return of -1.6%, said a news release from the $50.7 billion sovereign wealth fund.
The top performer was private equity, which returned 5.4%; followed by infrastructure, 3.8%; non-U.S. bonds, 1.8%; real estate, 0.2%; absolute return, 0.1%; U.S. bonds, -0.2%; U.S. equity and outsourced CIO allocations, -0.9% each; private markets outsourced CIO allocations, -2.1%, global equity, -2.8%; multiasset emerging markets, -4.2%; international equity, -5.4%; and “true special opportunities,” -5.5%………………………………….Full Article: Source

A Sovereign Wealth Fund For The Eurozone?

Posted on 20 November 2014 by VRS  |  Email |Print

Social Europe Journal has just published its latest Research Essay “Public Capital in the 21st Century” by Giacomo Corneo. The main argument of the paper is that the state should become a kind of investment state in order to make sure that high returns on capital do not further increase inequality but benefit the wider public.
To achieve this, Corneo argues that governments should set up sovereign wealth funds to manage their investments and take advantage of low interest rates on sovereign bonds as investments should be debt-financed. Having read the paper I was wondering whether this would also be an option to create the much-touted fiscal capacity for the Eurozone. Such a mechanism wouldn’t need Eurozone taxes or tax harmonisation (although both would be desirable) and does not require an open-ended commitment to joint debt……………………………….Full Article: Source

Faraj Guliyev: “SOFAZ should reconsider ruble policy”

Posted on 20 November 2014 by VRS  |  Email |Print

State Oil Fund of Azerbaijan should reconsider ruble policy, said the MP Faraj Guliyev in the discussion of budget package for 2015 at the plenary meeting of Azerbaijani Parliament.
He noted that SOFAZ invested in ruble and as the ruble’s value declines, Fund’s assets will also be decreased: “Ruble’s value declines. If it continues, our assets in ruble will decrease. I think the Fund should reconsider ruble policy”. Guliyev also says measures should be taken for reduction of dependence of budget on oil: “There are countries without oil. How do they form the budget?”………………………………Full Article: Source

Consumer inflation exceeds core inflation for the third straight month in Azerbaijan

Posted on 20 November 2014 by VRS  |  Email |Print

Parliament of Azerbaijan clamped down on an attempt to withdraw assets of the State Oil Fund of Azerbaijan (SOFAZ) from the world markets in order to decrease internal loan rate to 2%. Valeh Alasgarov, Vice Speaker of the Parliament, called for the deputies to stop speculative talks on impact of fall in the world oil prices to the economy of the country and on withdrawal of SOFAZ assets from foreign markets.
“Can you imagine what could happen if Azerbaijan hadn’t accumulate funds in the Oil Fund? What kind of future could we face if we hadn’t allocate funds for implementation of Shah Deniz, TAP, TANAP and other projects, as well as for construction of the bridge over Samur. I want to say that every decision taken by the government of Azerbaijan is well-considered and reasonable and it’s confirmed by today’s development of our economy and today’s image of our country. That’s why I call for the deputies to stop such talks and speculations on the existing situation”, - Alasgarov said……………………………….Full Article: Source

Krone-Oil Ties Show Cracks as Norway Curbs Deflation: Currencies

Posted on 20 November 2014 by VRS  |  Email |Print

Norway’s government funnels most of its oil revenue into its sovereign-wealth fund, the world’s largest. Prime Minister Erna Solberg, who came to office last year, has cut taxes to boost productivity in the mainland economy and said Norway needs to diversify away from oil.
Norges Bank Governor Oeystein Olsen said in an interview in Bergen, Norway, yesterday that he sees “dark clouds” ahead for the economy, partly because of concerns over the development of the oil industry. Energy companies predict the sector will see an 18 percent drop in investment in 2015……………………………….Full Article: Source

Kazakhstan’s Alliance Bank says completes debt restructuring

Posted on 20 November 2014 by VRS  |  Email |Print

Kazakhstan’s Alliance Bank has completed a $1.2 billion debt restructuring and the country’s sovereign wealth fund will put 220 billion tenge ($1.2 billion) of special deposits into the bank to support the deal, Alliance’s chief executive said on Wednesday.
Sovereign wealth fund Samruk-Kazyna will support the restructuring through 10-year special term deposits with an aggregate nominal value of 220 billion tenge, CEO Timur Issatayev told Reuters……………………………….Full Article: Source

Kazakhstan SWF to Sponsor Turkish Football Giant?

Posted on 20 November 2014 by VRS  |  Email |Print

Footballers for Galatasaray, the legendary Turkish club, may soon be wearing the name of Kazakhstan’s capital, Astana, across their chests. Kazakhstan’s sovereign-wealth fund, Samruk-Kazyna, is rumored to be close to signing a five-year, $50 million deal to sponsor Galatasaray, Turkish media has reported.
Samruk-Kazyna is the main source of funding for the Astana Presidential Sports Club. Astana was already affiliated with the Istanbul-based team after the two signed a cooperation agreement in April. It is unclear if the jerseys will be marked “Astana” or “Samruk-Kazyna.”………………………………Full Article: Source

FiscalNote snares $7 million in investments from Winklevoss, Singapore wealth fund

Posted on 20 November 2014 by VRS  |  Email |Print

A District-based start-up that uses artificial intelligence to predict the outcome of legislation has received $7 million in funding, including investments from the Singapore sovereign wealth fund and from the Winklevoss twins, made famous from their lawsuits against Facebook.
FiscalNote, founded by a Potomac entrepreneur, uses data-mining software and artificial intelligence to predict the fate of the bills proposed by state legislatures and by Congress each year. The company claims 94 percent accuracy……………………………….Full Article: Source

Panama has rising fiscal deficits, despite strong growth: Moody’s

Posted on 20 November 2014 by VRS  |  Email |Print

Additionally, two important institutional arrangements in the fiscal arena are the Social Fiscal Responsibility Law (SFRL) and a sovereign wealth fund (Fondo de Ahorro de Panama, or FAP), although they have had a limited and somewhat questionable track-record. Over the past few years, authorities have repeatedly circumvented the deficit ceiling defined by the SFRL through a series of waivers and changes.
While we recognize that policy flexibility is required to respond to special conditions, the frequency of changes and waivers to the fiscal rule reaffirms our view that Panama’s fiscal arrangements lack credibility and, consequently, fail to enhance policy predictability. Until the government establishes a track record of strict adherence to the terms of these fiscal controls, they will provide limited credit enhancement. Moreover, we do not expect the sovereign wealth fund to generate significant net savings……………………………….Full Article: Source

Bahrain’s Mumtalakat Said to Raise $600 Million From Sukuk

Posted on 19 November 2014 by VRS  |  Email |Print

Bahrain Mumtalakat Holding Co., the Gulf country’s sovereign wealth fund, raised $600 million from the sale of Islamic bonds, according to a person familiar with the deal, as it seeks funds to refinance debt.
The seven-year sukuk will be priced to yield 205 basis points, or 2.05 percentage points, over the benchmark midswap rate, said the person, asking not to be identified because the information is private. The price Mumtalakat paid fell from initial guidance of about 237.5 basis points above midswaps as demand increased, the person said………………………………….Full Article: Source

Bahraini fund Mumtalakat launches $600 mln seven-year sukuk

Posted on 19 November 2014 by VRS  |  Email |Print

Bahrain sovereign fund Mumtalakat has launched a $600 million seven-year sukuk at the tight end of its previously-marketed price range, with the sale set to complete later on Tuesday, a document from lead managers said.
The sukuk pricing was last revised to 210 basis points, plus or minus 5 bps, over midswaps, after being marketed initially at 220 bps over the same benchmark guidance. BNP Paribas, Deutsche Bank, Mitsubishi UFJ Financial Group and Standard Chartered are arrangers to the deal………………………………….Full Article: Source

Singapore’s Temasek invests in Tel Aviv University technology

Posted on 19 November 2014 by VRS  |  Email |Print

Singapore-based investment company Temasek agreed to help fund new technologies emerging from research at Tel Aviv University, the university’s technology company Ramot said. Temasek agreed with Ramot to invest $5 million in the $23.5 million Momentum Fund, which selected six technologies earlier in 2014 and is in the process of choosing another four to six.
Temasek, which has a portfolio valued at $177 billion, will be a lead investor in the fund along with India’s Tata Industries. The funds will go to a variety of technologies ranging from environment and clean tech to pharmaceuticals………………………………….Full Article: Source

1MDB Criticized by Lawmakers Before Sukuk Sale: Islamic Finance

Posted on 19 November 2014 by VRS  |  Email |Print

Malaysia’s opposition lawmakers are criticizing rising debt at the sovereign wealth fund as the company plans to sell the nation’s biggest sukuk of 2014. 1Malaysia Development Bhd.’s power unit is seeking to raise 8.4 billion ringgit ($2.5 billion) before year-end, which will increase its outstanding debt to $15 billion, data compiled by Bloomberg show.
The fund, which counts Prime Minister Najib Razak as chairman of its advisory board, attracted criticism last year over fees and profits made by Goldman Sachs Group Inc. for arranging a $3 billion bond. 1MDB is financing projects under Najib’s $444 billion development program, which has pushed Malaysia’s borrowings to 52.8 percent of gross domestic product, near the self-imposed 55 percent limit…………………………………Full Article: Source

1MDB made RM1.6 billion from Cayman deal, says chairman

Posted on 19 November 2014 by VRS  |  Email |Print

The chairman of scandal-ridden 1Malaysia Development Berhad (1MDB) said the move to park funds in the Cayman Islands had yielded a profit of US$488 million (RM1.63 billion) from an initial investment of US$1.8 billion in an oil and gas venture.
This comes in the heels of accusations that the sovereign wealth fund had “lost” the funds after accumulating RM38 billion debts in just five years of its operations. One of its fiercest critics is former prime minister Tun Dr Mahathir Mohamad, who asked Putrajaya to explain how a fund saddled with RM38 billion debt could benefit Malaysians………………………………….Full Article: Source

1MDB managed competently

Posted on 19 November 2014 by VRS  |  Email |Print

Overly leveraged is the oft repeated criticism of detractors of 1Malaysia Development Berhad (1MDB), the nation’s strategic development company. Other accusations include the issue of the company’s lack of transparency, a fair demand on a state-owned investment arm. Once the Terengganu Investment Company, a sovereign wealth fund for the state, it was renamed 1MDB in 2009.
When the prime minister announced the name change, he declared that the expansion was meant to benefit all of the population instead of merely the people of Terengganu. And this the country’s investment vehicle will achieve by boosting Malaysia’s economic transformation agenda, the avenue by which the country will become high-income and fully developed by year 2020, at the latest………………………………….Full Article: Source

Irish sovereign fund to consider social housing investment

Posted on 18 November 2014 by VRS  |  Email |Print

Ireland’s sovereign wealth fund would be open to investing in social housing but will be careful not to allocate too much of its €7bn capital to low economic impact projects, according to its head of infrastructure and credit.
Donal Murphy, previously head of project finance at Bank of Ireland and part of an in-house team that has grown from 13 to 35, said the National Pensions Reserve Fund (NPRF) was initially examining domestic investment propositions on the binary basis of providing an economic impact, or lacking one………………………………..Full Article: Source

Afraid of ‘difficult’ questions? Ahmad Maslan CHICKENS OUT of 1MDB forum

Posted on 18 November 2014 by VRS  |  Email |Print

Deputy Finance Minister Datuk Ahmad Maslan said today that he did not receive an invite to Pakatan Rakyat’s forum on 1Malaysia Development Berhad (1MDB), despite the forum’s promotional poster featuring him as a speaker, and that he will not be attending it.
Ahmad also said the government-owned strategic development company’s CEO Mohd Hazem Abd Rahman, who was also featured as a speaker in the forum’s promotional poster, has told him that he would not be attending the forum billing DAP’s Petaling Jaya Utara MP Tony Pua and PKR’s Pandan MP Rafizi Ramli as speakers. “I’ve already answered in Parliament, so there’s no need to attend the forum,” Ahmad said………………………………..Full Article: Source

1MDB abusing proceeds from US$3 billion bond, says DAP lawmaker

Posted on 18 November 2014 by VRS  |  Email |Print

In another twist to the 1Malaysia Development Bhd (1MDB) saga, a federal lawmaker has claimed that the state sovereign fund is diverting part of the proceeds of the US$3 billion (RM9.6 billion) loan raised by its subsidiary to fund operating expenses and pay off its burgeoning debts.
This, said Tony Pua (DAP - Petaling Jaya Utara) clearly showed that 1MDB was facing difficulties in balancing its cash flow. The sovereign fund’s wholly owned subsidiary, 1MDB Global Investments Limited, had issued a bond to raise US$3 billion in March last year………………………………..Full Article: Source

Bahrain’s Mumtalakat sets initial price guidance for up-to-$600 mln sukuk

Posted on 18 November 2014 by VRS  |  Email |Print

Bahrain sovereign fund Mumtalakat has opened order books after setting initial price guidance for an up-to-$600 million seven-year Islamic bond offering, a document from lead managers said.
The firm has set initial price thoughts in the area of 237.5 basis points over midswaps for the sukuk, which is expected to price on Tuesday, the document showed. A series of meetings with fixed income investors is set to conclude on Monday in London, having been hosted in Asia and the Middle East last week, arranged by BNP Paribas, Deutsche Bank, Mitsubishi UFJ Financial Group and Standard Chartered………………………………..Full Article: Source

Analysts dim on Zim’s new state fund

Posted on 18 November 2014 by VRS  |  Email |Print

The Zimbabwean Sovereign Wealth Fund (SWF) funded from mineral royalties will not work unless President Robert Mugabe’s Zanu PF-led government addresses poor confidence in the country’s economy, declining foreign direct investments as well as a woeful budget position, experts told Business Report on Friday.
The political uncertainty emanating from fights to take over from Mugabe have added to investor worries in the country. Lack of investments, coupled with a flat-lining economy characterised by a continued decline in productivity and rising imports has seen most companies and businesses battle to stay afloat………………………………..Full Article: Source

Norway Wealth Fund Outsmarts Flash Boys as Algorithms Abandoned

Posted on 17 November 2014 by VRS  |  Email |Print

Oeyvind Schanke, head of asset strategies at Norway’s $860 billion sovereign wealth fund, has worked out how to dodge traders in the U.S. trying to profit on his orders by leaving no pattern for them to track.
Investors who want to pre-empt trades by the world’s biggest sovereign-wealth fund and act on that information to make a profit — a practice known as front running — won’t have much success, he said………………………………….Full Article: Source

Norway’s oil fund, TIAA-CREF buy Washington property

Posted on 17 November 2014 by VRS  |  Email |Print

Norway’s sovereign wealth fund and U.S. financial services group TIAA-CREF have bought a Washington D.C. property in a deal valuing the site at $165 million, the fund said on Friday.
The fund bought a 49.9 percent stake for $82.3 million, which according to the statement has no debt, while TIAA/CREF bought the rest and will manage it on behalf of the partnership, it added. The property was bought from The Maritime Engineers Beneficiary Association, which will have a 99 year lease on it………………………………….Full Article: Source

Norway’s oil fund targets ‘forever’ horizon in real estate market

Posted on 17 November 2014 by VRS  |  Email |Print

Targeting an investment horizon of “forever”, Norway’s $860 billion oil fund plans to enter the Asian real estate market next year and aims to broaden its asset range to include anything from new developments to refurbishments, it said.
Stepping up its activity after a gradual start and aiming to invest around $8-$10 billion a year, the fund will also do more property deals on its own as it struggles to find partners with deep enough pockets, Karsten Kallevig, its real estate chief, told Reuters………………………………….Full Article: Source

SNB head says no sovereign fund for gold if referendum passes: paper

Posted on 17 November 2014 by VRS  |  Email |Print

The chairman of the Swiss central bank ruled out creating a sovereign wealth fund to manage Switzerland’s gold reserves if a referendum on banning the bank from selling them passes, according to a newspaper interview published on Sunday.
The “Save our Swiss gold” proposal, spearheaded by the right-wing Swiss People’s Party (SVP), will be put to a plebiscite on Nov 30. It aims to ban the central bank from offloading the reserves and oblige it to hold at least 20 percent of its assets in gold………………………………….Full Article: Source

National Pensions Reserve Fund a winner in transparency index ratings

Posted on 17 November 2014 by VRS  |  Email |Print

In case you missed it, this week saw the release of the long-awaited third-quarter Linaburg-Maduell Transparency Index Ratings, aka the Oscars of the sovereign wealth universe. The main “takeaway” from the publication is that we, the State, did well and everybody likes it when we do well in internationally graded tests. In fact, we got a clean 10 out of 10.
The prize-winner in this instance was the National Pensions Reserve Fund, the erstwhile guardian of our future pensions before it was raided under the bailout. These days, the fund is all about strategic investments that might improve the domestic economy and make a profit at the same time. It’s an unusual approach for a sovereign fund – one that has been described by the structure itself as a quest for a “double bottom line”. The jury is still out on the merits of same, but that’s an argument for another day………………………………….Full Article: Source

Sovereign wealth fund acquisitions surge as confidence returns

Posted on 17 November 2014 by VRS  |  Email |Print

Sovereign wealth funds are buying up assets this year at their fastest rate since the financial crisis as these state-run pools of assets regain the confidence lost when big punts on western banks turned sour, Thomson Reuters data shows.
Thomson Reuters data shows sovereign wealth funds, which invest windfall revenues from oil and other exports for future generations, were involved in deals worth $40 billion (25.55 billion pound) in the first nine months of 2014, the highest rate since 2007. The money was spent across 79 transactions - the highest number since 2008 - with real estate and infrastructure dominating the deal flow………………………………….Full Article: Source

Iran to draw on sovereign fund to withstand oil price slide

Posted on 17 November 2014 by VRS  |  Email |Print

Iran will draw on its sovereign wealth fund to cope with damage to its economy from plunging global oil prices, Iranian Oil Minister Bijan Zanganeh was quoted by the ministry’s news agency Shana as saying. “By drawing upon its National Development Fund to reimburse contractors active in upstream projects, Iran will make up for the impact of the oil revenue decline on these projects,” Zanganeh said, according to a Shana report on Saturday.
Iran’s National Development Fund is worth about $62 billion, according to the Sovereign Wealth Fund Institute, which tracks the industry. Some of its assets may be frozen by international sanctions imposed over Iran’s disputed nuclear programme………………………………….Full Article: Source

Italian, Qatari Funds Make First Investment In Italian Food

Posted on 17 November 2014 by VRS  |  Email |Print

State-backed Italian and Qatari investors are to buy a 165 million euro ($205 million) stake in Inalca, expanding the Italian meat producer’s overseas markets in the first such deal by the two investment partners. Under the deal signed on Friday, the IQ Made in Italy joint venture will buy a 28.4 per cent stake in Inalca, currently wholly owned by Italian food producer and caterer Cremonini.
Italian state-backed private equity fund Fondo Strategico Italiano (FSI) and Qatar Holding, a fund created by the Qatar Investment Authority, set up the joint venture in March 2013 to invest in a range of Italian companies in the food, fashion and luxury, tourism and leisure sectors………………………………….Full Article: Source

Oman SWF-SBI JV to raise $250M to back ventures under ‘Make in India’ campaign

Posted on 17 November 2014 by VRS  |  Email |Print

The fund was formed in 2011 with equal equity contribution from SBI and SGRF, one of Oman’s sovereign wealth funds. A joint investment fund set up by SBI and Oman’s sovereign fund will raise its corpus by $250 million for a special purpose vehicle (SPV) to capitalise on the new government’s ‘Make in India’ initiative.
“The ministerial India-Oman Joint Commission, has accorded a political go-ahead for the second tranche with modalities to be worked out by State Bank of India (SBI) and State General Reserve Fund (SGRF) for its launch at the earliest,” Indian ambassador to Oman, J S Mukul said………………………………….Full Article: Source

CIC, Illinois Teachers eye cross-border deals

Posted on 14 November 2014 by VRS  |  Email |Print

China Investment Corporation (CIC) and Illinois Teachers’s Retirement System have been talking up the benefits of private equity investors and managers collaborating on cross-border deals. China’s sovereign wealth fund said it was keen on facilitating European deals, while the $46 billion US state pension spoke about its recently agreed partnership with a PE fund-of-funds manager and the types of tie-ups it was seeing.
CIC’s head of private equity, He Linbo, said the sovereign wealth fund is willing to act as a bridge to connect both Chinese companies with overseas investors, and foreign companies with opportunities in the mainland…………………………………..Full Article: Source

Costello defends Future Fund tax bill

Posted on 14 November 2014 by VRS  |  Email |Print

Future Fund chairman Peter Costello has defended the amount of tax the sovereign wealth fund pays, saying it has ’sovereign immunity’ when it invests overseas. The government-owned Fund was named along with other Australian companies for using Luxembourg as a base in which to lower global taxes in one of the biggest global tax leaks in history, published last week.
Thousands of leaked documents released by the International Consortium of Investigative Journalists revealed how Australian and multinational companies used accounting firm PricewaterhouseCoopers to strike deals in Luxembourg to shift profits and avoid tax…………………………………..Full Article: Source

Don’t bend the rules for 1MDB, Anwar tells Putrajaya

Posted on 14 November 2014 by VRS  |  Email |Print

Datuk Seri Anwar Ibrahim warned Putrajaya against manipulating the checks and balances set out by the Treasury in order to counter the allegations against 1Malaysia Development Berhad (1MDB), saying that the fund is now “the government’s greatest liability”.
The former deputy prime minister, who also served as finance minister from 1992 up to his sacking in 1998, insisted that there was no difference between a letter of support and a sovereign guarantee as Putrajaya is still liable if the state investment arm fails to service its loan………………………………….Full Article: Source

Malaysian government spends $10 million on plane searches

Posted on 14 November 2014 by VRS  |  Email |Print

Malaysia has spent 33.46 million ringgit (10 million dollars) to date in the search and rescue operations after two tragedies hit its national airline this year, an official said Thursday. The Malaysian state sovereign fund Khazanah Nasional has said that it would pump 6 billion ringgit into the ailing Malaysia Airlines to rehabilitate the national carrier.
Transport Minister Liow Tiong Lai said 3,732 Malaysian civil servants have helped in the massive multinational search and rescue operations for Malaysia Airlines flights MH370 and MH17…………………………………..Full Article: Source

UK mulls shale gas fund to avoid ’squandering’ revenue

Posted on 14 November 2014 by VRS  |  Email |Print

The UK is considering setting up a wealth fund from the proceeds of the fracking industry. Communities would benefit, but many question whether fossil fuels like shale gas are the way forward.
In January this year, British Prime Minister David Cameron said the UK was “going all out for shale,” as the country’s oil and gas operations in the North Sea age, with Britain becoming a net importer of oil and gas again in the mid-2000s. The government has therefore set its sights on shale gas, which has seen a boom in the US. In Europe, it is controversial due to environmental concerns…………………………………..Full Article: Source

Rocco Forte secures funding from Italian sovereign wealth fund

Posted on 14 November 2014 by VRS  |  Email |Print

Rocco Forte Hotels has announced a strategic partnership with Fondo Strategico Italiano Spa, the Italian State-backed sovereign fund 80 per cent controlled by Cassa Depositi e Prestiti and 20 per cent by Bank of Italy.It has a paid-up share capital of €4.4 billion.
FSI will inject £60 million into Rocco Forte and Family in exchange for an equity stake of 23 per cent, valuing the enlarged equity at £260 million. Rocco Forte Hotels has partnered with FSI because it is a strategic and long-term investor…………………………………..Full Article: Source

Zim mine royalties put into new fund

Posted on 14 November 2014 by VRS  |  Email |Print

Zimbabwe’ Treasury is to put a quarter of the country’s mining royalties into a new sovereign wealth fund, which will be managed by the central bank. Several oil-rich African countries such as Algeria and Nigeria have sovereign wealth funds. Zimbabwe is desperate to renew its infrastructure, which includes electricity-generating plants, roads, rail and water treatment facilities neglected for the last 20 years.
According to new laws signed by President Robert Mugabe this week, and seen by online financial publishers, The Source, every withdrawal from the fund must be approved by parliament and be accounted for, and proceeds from the fund may not be used as collateral for credit to government and public enterprises…………………………………..Full Article: Source

Brazil, China, India still offer investment value - CPPIB

Posted on 14 November 2014 by VRS  |  Email |Print

Brazil, China and India still offer long-term investment value but a lot of global assets are fully priced and competing with huge sovereign wealth funds is getting harder, one of Canada’s biggest dealmakers said on Thursday. Mark Wiseman, CPPIB’s chief executive, said he’s optimistic about North American assets and longer-term plays in Brazil, China and India, where economic growth looks set to continue.
Wiseman said the market is seeing the growth of large and increasingly sophisticated pools of capital in the form of sovereign wealth funds, in Singapore, South Korea, China and the Middle East, all of whom are competing for similar deals…………………………………..Full Article: Source

Libya fund sues France’s SocGen for $1.5 bn

Posted on 13 November 2014 by VRS  |  Email |Print

Libya’s sovereign wealth fund is suing French bank Societe Generale for $1.5 billion (1.2 billion euros) for allegedly channelling bribes to allies of Moamer Kadhafi’s son, in a case hitting the London courts Wednesday.
The Libyan Investment Authority (LIA) is seeking compensation from the bank and from Walid Giahmi, an alleged associate of Seif al-Islam, for what it says is money that it lost on trades between 2007 and 2009. Libyan dictator Kadhafi was killed in 2011 during a NATO-backed uprising. Seif was long his father’s right-hand man and heir apparent………………………………………..Full Article: Source

SocGen denies allegations of funnelling bribes in LIA lawsuit

Posted on 13 November 2014 by VRS  |  Email |Print

Société Générale and a Libyan businessman have denied “extremely serious” allegations that they helped funnel bribes to influence the Libyan Investment Authority to enter into complex trades, the High Court has been told.
The LIA, now under new management since the fall of Colonel Gaddafi in 2011, has filed a $1.5bn lawsuit against the French bank as well as Libyan businessman Walid Al-Giahmi and a Panamanian company Leinada, which was controlled by Mr Giahmi, in relation to payments relating to five controversial trades………………………………………..Full Article: Source

SocGen Denies Bribing Qaddafi Friend in Libya Fund Case

Posted on 13 November 2014 by VRS  |  Email |Print

Societe Generale SA denied paying bribes to Libya’s sovereign wealth fund, saying $58 million in payments to a family friend of Muammar Qaddafi were to help the bank “navigate the unfamiliar and difficult” market in the country.
The payments to Walid Giahmi’s company, Leinada Inc., were for “introductory, market intelligence and follow-up services,” the Paris-based bank said in documents at the first U.K. court hearing in the Libyan Investment Authority’s lawsuit against the French lender………………………………………..Full Article: Source

Zimbabwe: Sovereign Wealth Fund Act Takes Effect

Posted on 13 November 2014 by VRS  |  Email |Print

Legislation to establish the Sovereign Wealth Fund is now in place following the gazetting of the Sovereign Wealth Fund Act on Monday, a landmark development which seeks to establish a facility whose objective is to reserve income from the country’s finite mineral resources for the benefit of future generations.
The fund will be driven primarily by 25 percent of all royalties on mineral exports, which will be deposited, along with special dividends on the sales of diamonds, gas, granite and other minerals through the Zimbabwe Mining Development Corporation. The Reserve Bank of Zimbabwe will be the primary custodian of the fund………………………………………..Full Article: Source

Mugabe signs Sovereign Wealth Fund bill

Posted on 13 November 2014 by VRS  |  Email |Print

The Treasury will, with immediate effect, remit a quarter of mining royalties to the Sovereign Wealth Fund (SWF) after President Robert Mugabe on Monday signed into law a bill to set up the fund, which is meant to secure investments for future generations and support economic growth.
A sovereign wealth fund is a state-managed pool of money drawn from the country’s reserves, set aside for investment in strategic areas that benefit the economy and its citizens. Funding for sovereign wealth funds is typically accumulated from revenues generated from the export of a country’s natural resources, such as minerals………………………………………..Full Article: Source

Dr. Mahathir:Malaysia can do without 1MDB

Posted on 13 November 2014 by VRS  |  Email |Print

Tun Dr Mahathir Mohamad said Malaysia does not need a sovereign fund like the 1Malaysia Development Berhad (1MDB), especially if it results in losses for the country. The former prime minister (PM) said Malaysia could do without the 1MDB, which has been criticised for its lack of transparency as well as for racking up big debts to finance its projects.
Some of 1MDB’s business strategies have also been questioned recently and the fund has been accused of paying above market rates for some of its investments. “We can do without the 1MDB,” Dr Mahathir said when asked whether 1MDB should be shut down………………………………………..Full Article: Source

Support letter issued to 1MDB is not ‘explicit government guarantee’, says Ahmad Maslan

Posted on 13 November 2014 by VRS  |  Email |Print

Deputy Finance Minister Datuk Ahmad Maslan insisted that Putrajaya’s letter of support for 1Malaysia Development Berhad’s (1MDB) fundraising exercise is not an “explicit guarantee”, sidestepping concerns that the federal government will have to foot the sovereign wealth fund’s debt. He stressed that the ministry had only given an explicit guarantee amounting to RM5.8 billion to the sovereign wealth fund.
At a press conference at the Parliament lobby today, Ahmad reiterated that the Finance Ministry’s letter of support — published in investment banker Goldman Sachs International’s (GSI) Offering Circular in 2012 and 2013 — only meant that 1MDB has to restructure its assets valued at RM51.41 billion to settle its debt if the sovereign wealth fund is unable to service its loan according to the stipulated terms………………………………………..Full Article: Source

1MDB already audited by a ‘big company’, A-G says

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The Auditor-General’s Department did not audit 1Malaysia Development Bhd (1MDB), which is accused of financial irregularities, because it was already audited by “a big international” firm, Auditor-General Tan Sri Ambrin Buang said.
“As far as their accounts is concerned, there is no need to come back and open their books because they have already been audited by one of the big boys,” Ambrin told a town hall meeting on the third series of the 2013 A-G report held at the Angkasapuri here………………………………………..Full Article: Source

Oil Fund set for shake-up for fairness

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Energy policymakers will reconsider the role of the state Oil Fund after its burden in subsidising liquefied petroleum gas (LPG) prices ends, says Energy Minister Narongchai Akrasanee.
“Once the fund turns to black, which should be achieved soon, its role will need to be reviewed. We won’t need to levy a lot of money, as we will not return to heavily subsidising the wrong type of fuel as past governments did,” he said Wednesday. The fund is gradually recovering from a loss of 1 billion baht caused by LPG price subsidies.Mr Narongchai said details of the Oil Fund’s future role and levies had not been finalised………………………………………..Full Article: Source

Rosneft Must Keep Hands Off Wealth Fund, Kudrin Says

Posted on 13 November 2014 by VRS  |  Email |Print

The man who designed Russia’s rainy-day fund to protect against swings in commodity prices says the country’s state oil company shouldn’t be allowed anywhere near the money. OAO Rosneft (ROSN), headed by Igor Sechin, a long-time ally of President Vladimir Putin, asked last month for more than $44 billion from Russia’s Wellbeing Fund to finance investment after sanctions closed capital markets for the company.
The request runs totally against the spirit of the reserve, designed to hedge against dependence on energy exports, said Alexei Kudrin, who was finance minister for more than a decade until 2011………………………………………..Full Article: Source

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