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Sovereign Wealth Funds Briefing - Archive | March, 2015

GIC, Temasek to invest S$642m each in airport retailer Dufry

Posted on 31 March 2015 by VRS  |  Email |Print

Singapore’s sovereign wealth fund GIC and investment firm Temasek Holdings will invest 450 million Swiss francs (S$642 million) each in the airport retailer Dufry. They plan to purchase shares from a rights issue by Dufry, which is trying to raise funds for its billion-dollar deal to acquire Italy’s World Duty Free (WDF) Group.
The Swiss-based retailer is paying €1.3 billion (S$1.94 billion) to buy a 50.1 per cent stake in WDF from Italy’s Benetton family through its holding company Edizione. The deal will trigger a mandatory offer for the balance of World Duty Free’s outstanding shares at the same terms. Under the terms, Dufry will pay €10.25 per share in cash for each WDF share, valuing the Italian firm at about €3.6 billion after taking into account debt, which stood at €970 million at the end of last year………………………………………..Full Article: Source

Dufry’s Duty Free Purchase Attracts Cash From Qatar, Singapore

Posted on 31 March 2015 by VRS  |  Email |Print

The planned acquisition by Switzerland’s Dufry AG of Italian rival World Duty Free SpA marks the latest push by Qatar and Singapore into Europe as funds based in the countries target the region’s growth areas.
The Singaporean sovereign-wealth fund GIC Pte, the Asian country’s state investment firm Temasek Holdings Pte and the Qatar Investment Authority are each committing as much as 450 million Swiss francs ($467 million) to Dufry. The investments will help fund the Swiss company’s purchase of WDF, a deal that will form the world’s leading airport-retail operator………………………………………..Full Article: Source

GIC among investors bidding for German group Tank & Rast in $4.11b deal

Posted on 31 March 2015 by VRS  |  Email |Print

German motorway service station group Taoutnk & Rast (Tank & Rast), which has been up for grabs for three months now, has attracted several investor groups including Singapore’s GIC to bid in a deal worth up to 3.5 billion euros ($4.11 billion).
Reuters found out through sources that the investors were preparing to bid for the group, which British buyout group Terra Firma Capital Partners put up for sale in January this year. Tank & Rast could appeal to pension funds and insurers who are focusing on infrastructure investments to generate better returns than from government bonds, the sources said………………………………………..Full Article: Source

Amcorp steps up UK venture with Temasek

Posted on 31 March 2015 by VRS  |  Email |Print

Amcorp Properties Bhd has partnered with Temasek Holdings Pte Ltd in a redevelopment project in London valued at more than £1bil (RM5.46bil). It told Bursa Malaysia its indirect unit SNL Ltd (30% equity holding) had signed a subscription and shareholders’ agreement with Temasek’s indirect unit Hubbard Investments (30%), Singapore-based hotel operator Hotel Properties Ltd (30%) and a special-purpose vehicle controlled by the shareholders of London-based property developer Native Land (10%).
Their joint-venture (JV) firm, Bankside Quarter (Jersey) Ltd, on Friday bought the companies that own Sampson House and Ludgate House for £308mil (RM1.68bil), freehold office buildings next to the River Thames………………………………………..Full Article: Source

S.Korea sovereign wealth fund KIC may buy 19 pct of LA Dodgers -Yonhap

Posted on 31 March 2015 by VRS  |  Email |Print

Korea Investment Corp (KIC), South Korea’s sovereign wealth fund, is considering buying about 19 percent of the Los Angeles Dodgers baseball team for more than 400 billion won ($361.65 million), Yonhap reported on Monday.
KIC is conducting due diligence with a view to possibly buying the stake from global investment and advisory firm Guggenheim Partners, the newswire service reported citing an unnamed investment banking source or sources. A KIC spokesman declined comment. A media official representing Guggenheim could not be reached for comment………………………………………..Full Article: Source

China, Russia eyeing 32 projects with $75b investment: RDIF

Posted on 31 March 2015 by VRS  |  Email |Print

China and Russia are mulling 32 projects with total investment of up to $75 billion, Kirill Dmitriev, CEO of Russian Direct Investment Fund (RDIF), the country’s sovereign wealth fund, said. The projects include a petrochemical project between Chinese oil giant Sinopec and Russian petrochemical company Sibur, a project between Russian aircraft company Sukhoi Superjet and a number of Chinese investors to help the former expand its business in China, and a big metal project called Udocan deposit close to China, according to Dmitriev.
The projects, covering metals, agriculture, infrastructure and industries, were discussed at a meeting held Monday in Beijing by a consultative committee of entrepreneurs under the intergovernmental Russia-China Commission for Investment Cooperation. The $2 billion Russia-China Investment Fund (RCIF), launched jointly by RDIF and its Chinese counterpart China Investment Corporation in June 2012, has already approved 10 investment projects in metals, tourism and infrastructure sectors………………………………………..Full Article: Source

Exclusive interview with China Investment Corp. CEO (Video)

Posted on 31 March 2015 by VRS  |  Email |Print

At the just ended Boao Forum, CCTV’s reporter Xia Cheng caught up with Ding Xuedong, chairman and CEO of China Investment Corporation. CIC is the fifth-largest country fund in the world with more than 650 billion US dollars in assets under management. Markets view the company as a window on China’s perspective on the world economic outlook, and that’s exactly where the conversation starts.……………………………………….Full Article: Source

Bahrain’s Mumtalakat, Investcorp Acquire Private School Network In US

Posted on 31 March 2015 by VRS  |  Email |Print

Bahraini sovereign wealth fund Mumtalakat and investment firm Investcorp announced that they have jointly acquired Nobel Learning, a private school network in the US, from Leeds Equity Partners. The value of the transaction was not disclosed.
One of the largest private operators in the US, Nobel Learning operates a network of 176 schools across 18 states. The company also has an accredited online private school that offers college preparatory programmes to students from 55 countries worldwide. Founded in 1984, it now has approximately 5,000 teachers and staff and 25,000 students………………………………………..Full Article: Source

Qatar Companies to Invest $5 Billion in China for LNG Projects

Posted on 31 March 2015 by VRS  |  Email |Print

Two Qatari companies agreed to pay about $5 billion for a 49 percent stake in Shandong Dongming Petrochemical Group to help the Chinese business build an LNG receiving terminal and expand into retail gasoline sales.
The investment by Hamad bin Suhaim Enterprises and Qatra for Investment and Development will pay for the construction of a receiving terminal for liquefied natural gas, with a capacity of 3 million metric tons a year, and an LNG storage facility, Ibrahim El-Tinay, Qatra’s chief executive officer, told reporters Monday in the Qatari capital Doha. Shandong Dongming will also use the money to built 1,000 gasoline filling stations in six provinces south of Beijing, he said………………………………………..Full Article: Source

Kuwait Investment Authority will provide 550 million to an affiliate of Natural Gas

Posted on 31 March 2015 by VRS  |  Email |Print

Gas Natural Fenosa said Monday it has signed an agreement for the sovereign wealth fund Kuwait Investment Authority (KIA) make a capital of $ 550 million in Global Power Generation (GPG), a subsidiary of international generation Gas Natural Fenosa.
The Spanish group said the capital increase will be fully subscribed by KIA and in return, the Kuwaiti fund will have a 25 percent stake in GPG. In its press release, Natural Gas said the operation allows for an investor partner for boosting growth plans GPG, formed last year with the aim of entering new markets and boost the generation business abroad. (Translated)……………………………………….Full Article: Source

Spain’s Gas Natural says Kuwait’s KIA to invest in its overseas unit

Posted on 31 March 2015 by VRS  |  Email |Print

Spanish energy group Gas Natural said on Monday it was teaming up with sovereign wealth fund Kuwait Investment Authority (KIA) to develop its international business through its Global Power Generation (GPG) subsidiary.
Gas Natural said the Kuwaiti group would subscribe to a $550 million capital hike at GPG and take a 25 percent stake in the unit, which it created last October as part of its plans to grow overseas. These include, in the medium term, building an additional 5 Gigawatts in generation capacity, mainly in markets such as Latin America and Asia, Gas Natural added in a statement………………………………………..Full Article: Source

No dividend on Sovereign Wealth Fund till 2017

Posted on 31 March 2015 by VRS  |  Email |Print

The Nigerian Sovereign Investment Authority on Monday said it would not pay dividend on the Sovereign Wealth Fund until the end of the 2017 financial year. The Managing Director and Chief Executive Officer, NSIA, Mr. Uche Orji, disclosed this while addressing journalists in Abuja on Monday about the financial performance of the agency in the 2014 financial period.
He said the law setting up the Sovereign Wealth Fund did not allow the agency to pay dividend until the fund had posted profit for five consecutive years. The SWF, which was set up in 2012, is jointly owned by the federal, state and local governments. The three tiers of government are the shareholders that are expected to receive dividends from the fund………………………………………..Full Article: Source

Swiss banking model is ‘dead’, says Abu Dhabi finance chief

Posted on 31 March 2015 by VRS  |  Email |Print

Abu Dhabi intends to set itself up as a new hub for wealth management, with the head of its nascent international financial centre declaring Switzerland’s old model of private bank secrecy to be “dead”.
Abu Dhabi Global Markets is an expression of world ambition, intended to elevate the oil-and-gas-rich emirate to the tables of the most influential global institutions, such as the Basel Committee on Banking Supervision and the Group of 20 Nations, using Singapore rather than Switzerland as its model, its chairman told the Financial Times………………………………………..Full Article: Source

Norway Focuses on Tokyo and Singapore Real Estate Investments

Posted on 31 March 2015 by VRS  |  Email |Print

Singapore and Tokyo are the prime targets for real estate investment by Norway’s biggest wealth fund. The Norwegian Government Pension Fund Global, which has $870 billion in resources mainly from the country’s oil industry, is planning to snap up real estate in 10 to 15 cities around the world.
It has already bought properties in London, Paris, Berlin and New York. In 2014, around 2.2 per cent or $18 billion of its assets was invested in property and it is seeking to increase that proportion to five per cent. The fund is now seeking high-growth real estate investments in Tokyo and Singapore, the fund’s head of real estate investment Karsten Kallevig confirmed………………………………………..Full Article: Source

Putting oil revenues into a savings fund isn’t always a great idea

Posted on 31 March 2015 by VRS  |  Email |Print

Pundits outside Alberta are almost unanimous in their support for a Norway-style sovereign wealth fund. If only the Alberta government had saved more of its resource revenues, the argument goes, then the Alberta government would have saved more of its resource revenues. Or something like that; details are never the strong suit of big-picture pundits. It’s usually enough to make the clearly unarguable point that it would nice to have an extra $1 trillion on hand, just like the Norwegians.
The Alberta government could have set aside some of its revenues into a wealth fund. But then again, so could have the federal government and any of the other provincial governments; Quebec already has put away $7 billion into its Generations Fund. The mechanics are pretty simple: set expenditures less than revenues and put the savings into a wealth fund………………………………………..Full Article: Source

China’s CIC to boost foreign direct investment

Posted on 30 March 2015 by VRS  |  Email |Print

China’s giant sovereign wealth fund is stepping up direct investments in long-term global assets, focusing particularly on the US in a vote of confidence in the recovery in the world’s largest economy. Ding Xuedong, chairman of China Investment Corporation, which has about $US220 billion ($284bn) in overseas assets, said he saw diverging economic growth in coming years, with a resurgent US leading the way.
“The US is recovering faster than many have expected, which would make it the No. 1 engine of growth for the global economy,” Mr Ding said on the sidelines of the Boao Forum, an annual gathering of world political and business leaders in the southern Chinese island of Hainan………………………………………..Full Article: Source

HK’s property investment portfolio will double with the establishment of Future Fund

Posted on 30 March 2015 by VRS  |  Email |Print

Hong Kong is on track to raise its profile as a buyer of global property when the city’s Future Fund is launched this year, with government investments tipped to almost double to HK$68 billion under an expected tilt towards real estate. “There is considerable room for the Future Fund to assemble a sizeable real estate portfolio,” said Ada Choi, senior director for CBRE Research Asia, before the release of a report today by the property consultancy that suggests the Future Fund can learn from the established Asian sovereign wealth funds.
Their strategies favour investment in a broad selection of cities and countries with mature markets and sound legal systems, CBRE said. “The Hong Kong Future Fund is relatively small compared to other Asian [wealth funds], such as the China Investment Corporation (US$650 billion under management) and the Government of Singapore Investment Corporation (US$320 billion),” Choi said………………………………………..Full Article: Source

Singaporean govt’s property-buying spree in NZ reaches $1.2b

Posted on 30 March 2015 by VRS  |  Email |Print

The Singaporean Government’s sovereign wealth fund is expanding its New Zealand property holdings after taking a 49 per cent stake in 10 major properties for about $1.2 billion in the last year. Fletcher Building and Goodman Property Trust yesterday announced that Fletcher had struck a deal to sell a new Wynyard Quarter building, 80 per cent leased to Datacom, to the Singaporeans and Goodman, for $86.2 million.
The purchaser is Wynyard Precinct Holdings - 49 per cent owned by the Singapore state’s Government Investment Corporation (GIC) and 51 per cent owned by Goodman………………………………………..Full Article: Source

Nigeria Sovereign Investment Authority earned N15.8bn in 2014

Posted on 30 March 2015 by VRS  |  Email |Print

The Nigeria Sovereign Investment Authority on Sunday said it earned a net income of N15.8bn in the 2014 financial year. The agency, in its annual report made available to our correspondent by the Managing Director/Chief Executive Officer, Mr. Uche Orji, said the amount was a significant improvement on the N505m recorded in the 2013 financial period.
The NSIA is the agency currently managing the Sovereign Wealth Fund, which was set up in March 2013 by the Federal Government following the injection of an initial investment of $1bn. The initial investment was later followed with an additional investment of $550m about nine months later………………………………………..Full Article: Source

Qatar’s QIA to partly fund Dufry’s purchase of WDF: sources

Posted on 30 March 2015 by VRS  |  Email |Print

Qatar Investment Authority is partly financing Swiss travel retailer Dufry’s 1.3 billion-euro purchase of a majority stake in smaller Italian rival World Duty Free, according to three sources close to the matter.
Edizione, the holding company owned by the Benetton family that controls World Duty Free (WDF), said on Saturday it was selling its 50.1 percent stake in the group to Dufry for 10.25 euros per share. The deal values the Italian firm at 3.6 billion euros ($3.8 billion) and will make the combined group the world’s biggest travel retailer by far………………………………………..Full Article: Source

Dakar to nationalize Senegal Airlines

Posted on 30 March 2015 by VRS  |  Email |Print

Senegal Airlines (DN, Dakar) will be nationalized in a bid to stave off its imminent collapse the Senegalese government has announced. Amadou Hott, the CEO of the country’s sovereign wealth fund, told Bloomberg news in an interview that a new holding company will be established with government converting the debt it holds to equity in the new entity.
The airline, whose debt now stands at XOF45 billion (USD75 million), is owned by the Senegalese government (36%) and a consortium of local interests - Groupement National des Privés du Sénégal, Groupements de Prestataires Aéroportuaires and Fédération des Assureurs du Sénégal - with 64%. Hott said that once the airline’s finances have been stabilized, Dakar intends to sell a 49% stake off to a strategic investor with the remaining 51% to be owned by both the Senegalese government through the sovereign wealth fund as well as local investors………………………………………..Full Article: Source

Investor groups ready bids for German motorway station group

Posted on 30 March 2015 by VRS  |  Email |Print

Several investor groups are readying bids for German motorway service station group Tank & Rast, in a deal worth up to 3.5 billion euros ($3.8 billion), sources familiar with the transaction said. A consortium of Allianz, Munich Re (MEAG), sovereign wealth fund Abu Dhabi Investment Authority (ADIA) and Borealis, part of pension fund OMERS, aims to hand in an offer by a mid- to end-April deadline, the people said.
Canadian pension funds PSP and Ontario Teachers (OTPP) as well as Singapore sovereign wealth fund GIC are working on a joint offer, they added. The infrastructure arm of Australia’s bank Macquarie is also expected to express interest………………………………………..Full Article: Source

An idea for Ring of Fire’s riches

Posted on 30 March 2015 by VRS  |  Email |Print

Ontario should look to socialist Norway if it wants to capitalize on the rich mineral deposits of the far north’s Ring of Fire. Like Canada, Norway has a resource-based economy, exploiting extensive reserves of oil, natural gas minerals and lumber. Half its export revenues come from oil and gas. The money was invested in financial markets outside Norway. It grew. Their sovereign wealth fund, created a mere 20 years ago, now controls about one per cent of all publicly traded shares in the world.
It’s a rainy-day fund, set up because oil won’t flow forever. And Norway’s oil production has dropped to one-half of what it was in 2001, according to Huffington Post business editor Daniel Tencer in a recent article. Alberta established a Heritage Trust Fund in 1976, but stopped contributing to it. According to a report last month by the Macdonald-Laurier Institute, the total topped out a $17 billion, about one-tenth what it could have grown to with a strategy like Norway’s………………………………………..Full Article: Source

London or Paris: which is the club for Russia’s Ukraine debt?

Posted on 30 March 2015 by VRS  |  Email |Print

Russia lent Ukraine the $3 billion in December 2013 out of its “rainy day” sovereign wealth fund, structuring the debt as a two-year Eurobond governed by London law. That, experts agree, was a canny move, firstly because of the complexity of restructuring Eurobond debt, and secondly, because of an unusual clause allowing Russia to demand repayment early if Ukraine’s debt exceeded 60 percent of annual economic output.
So far Moscow has not demanded the money even though it is probably entitled to do so. Instead it seems intent on tightening the screws in another way - by declaring the bond to be bilateral sovereign debt and therefore not subject to the private creditor “bail-in”………………………………………..Full Article: Source

S.Korea’s KIC mulls taking up to $1.36 bln stake in 3 luxury hotels-Chosun Ilbo

Posted on 27 March 2015 by VRS  |  Email |Print

Korea Investment Corp (KIC), South Korea’s sovereign wealth fund, is considering investing around 1-1.5 trillion won ($906 million-$1.36 billion) in three five-star hotels owned by Saudi Arabia-based Kingdom Holding Co, a South Korean newspaper reported on Friday.
The hotels include The Savoy in London, and KIC is considering taking about a 50 percent stake, the Chosun Ilbo reported, citing unnamed KIC and investment banking sources. A KIC spokesman declined comment………………………………………..Full Article: Source

Goodman and Singaporean fund buy $86.2m Wynyard property

Posted on 27 March 2015 by VRS  |  Email |Print

NZX-listed Goodman Property Trust will end up owning 51% of a new building on Auckland’s waterfront,with the balance held by Singapore’s sovereign wealth fund, GIC. The site of the $86.2 million building has been cleared for earthworks and completion is expected during 2017.
It is being built by Fletcher Building and will be leased to Datacom, which has taken naming rights. Goodman’s relationship with the Singaporean fund was set up last year via a joint venture called Wynyard Precinct Holdings, with plans to build an initial $300 million portfolio………………………………………..Full Article: Source

Singapore Govt in new Akl property deal

Posted on 27 March 2015 by VRS  |  Email |Print

The Singaporean Government is expanding its New Zealand property holdings, taking a further stake in Auckland via a new office block yet to be built. Listed landlord Goodman Property Trust has just announced that Fletcher Building has struck a deal to sell a new Wynyard Quarter building, 80 per cent leased to Datacom, to the Singaporeans and Goodman.
The purchaser is Wynyard Precinct Holdings - 49 per cent owned by the Singapore state’s Government Investment Corporation and 51 per cent owned by listed landlord Goodman Property Trust………………………………………..Full Article: Source

Why Alberta is Not Like Norway

Posted on 27 March 2015 by VRS  |  Email |Print

Despite generating almost $190 billion in non-renewable resource revenues since 1980, the value of the Heritage Fund stood at $17.3 billion at the end of last year. And of the $33.4 billion in income that it’s thrown off, the Heritage Fund has retained just $4.6 billion.
Norway, in contrast, has managed to save much, much more of its non-renewable resource revenues. The value of its sovereign wealth fund sits at nearly $1 trillion, or $177,000 for every Norwegian citizen. Alberta’s per-capita figure? A shade over $4,300………………………………………..Full Article: Source

Investment in Sovereign Legacy Fund: Maurice enters the big league

Posted on 27 March 2015 by VRS  |  Email |Print

The state kills a major card in the management of its revenues. With the establishment of a Sovereign Legacy Fund, Maurice joined a league of nations where there are Norway, Saudi Arabia and Singapore. The sovereign funds of these countries is to grow the surplus from the marketing of petroleum products. This money is mainly used to compensate for any drop in state revenues given the volatility of oil prices on the world market.
This type of fund is invested mainly in blue chip stocks. “A sovereign wealth fund has a diversified investment portfolio,” says Poonam Teeluck, Associate Director at Elysium Capital, an investment bank. “This type of fund is active in the treasury bonds, commodities, real estate, to name a few. Some of these funds are so massive, with assets worth one trillion dollars that they can meet the needs of the country for decades. This is Norway, which has the largest sovereign fund, worth $ 860 billion, or Rs 31,600 billions! Maurice, so well that entering in this league, is less than a grain of sand, especially as the country is rich by its people, not its basement. (Translated)……………………………………….Full Article: Source

At SWFs, 2015 Is Shaping Up to Be A High Turnover Year for Management

Posted on 27 March 2015 by VRS  |  Email |Print

It’s been a busy year for sovereign wealth fund executives. We’ve seen a shake-up at the top of the China Investment Corp.(CIC), the launch of an entirely new fund in Mexico, and new hires at Australia’s Future Fund and Khazanah Nasional, among others. And a momentous change of leadership at Alberta Investment Management Corp. Here’s a roundup of all the moves from the first quarter 2015.
On February 25, the People’s Bank of China (PBoC), the country’s central bank, appointed Fan Yifei, CIC’s executive vice president, deputy chief operating officer and executive committee member, as its new vice chairman; he will now divide his time between the two institutions, an unusual arrangement whose implications China experts are still trying to decipher………………………………………..Full Article: Source

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

Posted on 26 March 2015 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 $307 million, the fund said on Wednesday.
The fund bought a 49.9 percent stake for $60.8 million, which according to the statement has debts of $185.1 million, while TIAA/CREF bought the rest and will manage it on behalf of the partnership, it added. The seller was not named. Last November, the two announced that they had bought another property in a similar deal………………………………………..Full Article: Source

Will Norway divest from giant Indian firm because of the Amazon?

Posted on 26 March 2015 by VRS  |  Email |Print

In 2010 the Council on Ethics for Norway’s “Government Pension Fund Global” (GPFG) recommended that the GPFG divest its holdings from giant Indian conglomerate Reliance Industries, which last year The Economist magazine described as “India’s biggest private firm (measured by profits).”
The justification was the threat that Reliance, as a minority partner in oil exploration in one of the remotest parts of Peru’s Amazon, was considered to pose to indigenous people who live so remotely they are sometimes described, misleadingly, as “uncontacted.”……………………………………….Full Article: Source

In Africa, SWFs Seek to Bridge Infrastructure Gap — And Make Money Too

Posted on 26 March 2015 by VRS  |  Email |Print

Across sub-Saharan Africa, sovereign wealth funds are stepping in to provide capital for big infrastructure projects. There are major risks — but the profits could be huge. The town of Bagamoyo, on Tanzania’s sun-drenched Indian Ocean coast, is a quiet seaport with a history of maritime trade. But it could be about to get a lot busier.
The Tanzanian government has signed an $11 billion deal to transform this historic harbor into Africa’s biggest port. Bagamoyo will become a “special economic zone,” shipping oil, gas and food products from East Africa to emerging economies in the Middle East, Asia and beyond. To secure funding for the project, the Tanzanian government brought in a pair of big foreign investors: Hong Kong-based infrastructure conglomerate China Merchants Holdings International Co. and a sovereign wealth fund, the $34.4 billion State General Reserve Fund of the Sultanate of Oman(SGRF)………………………………………..Full Article: Source

GIC bids to cash in on hot sector with $900m sell-off

Posted on 26 March 2015 by VRS  |  Email |Print

The Government of Singapore Investment Corporation is undertaking preparations to bring its $900 million Australian industrial and logistics property portfolio to market as it looks to capitalise on the surge in values in the sector. The group is poised to launch a portfolio offering in mid-2015 that could span about 25 properties across Australia, making it the ­nation’s largest direct industrial property portfolio sale.
The scale would be topped only by corporate deals, such as the Goodman Group-led consortium, including the Canadian Pension Plan Investment Board, Dutch pension group APG and China Investment Corporation, buying the $2.5 billion ING Industrial Fund in 2010………………………………………..Full Article: Source

Paladin Energy raises additional $50m from CIC

Posted on 26 March 2015 by VRS  |  Email |Print

Paladin Energy has raised an additional $US50 million by issuing convertible bonds to a unit of sovereign wealth fund China Investment Corporation (CIC). The proceeds will provide the company with additional funding flexibility.
The uranium miner (PDN) previously agreed to issue convertible bonds worth $US100m to CIC, with the funds to be used for the repurchase of existing convertible bonds due in November. The CIC investment will bolster Paladin’s cash position and reduce the need for any additional funding in the medium term, chief executive John Borshoff said in a statement………………………………………..Full Article: Source

Hutch agrees to buy O2, talks to SWFs

Posted on 26 March 2015 by VRS  |  Email |Print

Li Ka-shing-controlled Hutchison Whampoa has agreed to pay up to £10.25 billion ($15.2 billion) for UK mobile phone firm O2. The deal announced on Wednesday with Spanish parent Telefonica will create the UK’s biggest mobile operator, once O2 is merged with Hutchison 3G UK, and marks Hutchison Whampoa’s largest acquisition ever, as Hong Kong’s richest man Li doubles down on investments in Europe.
Hutchison Whampoa has not revealed any details of who the potential investors might be but, according to a source familiar with the matter, the company is in discussions with investors including sovereign wealth funds and private equity firms. There are a series of discussions going on with investors and a preference for sovereign wealth and pension funds. According to reports, Singapore’s GIC, Canadian pension funds, and Qatar’s sovereign wealth fund are among those that are in talks with Hutchison Whampoa………………………………………..Full Article: Source

Radical financial steps for the government: Setup a sovereign wealth fund

Posted on 26 March 2015 by VRS  |  Email |Print

We may have already missed the windfall opportunity from the mining boom to collect a significant amount of wealth, but there’s no time like the present to set up a sovereign wealth fund to benefit future generations such as the one established by Norway. Using proceeds from off-shore oil over 25 years, the fund is now worth more than US$1 trillion. The government is limited what it can take from the fund, so it continues to grow.
Ok, yes there may be some exceptions to each of these steps. And yes, some of these will negatively affect me. But I want Australia to be a prosperous nation, where taxes are fairer and certain sectors don’t benefit at the expense of others. If I have to bear some of that pain to see that vision come true then I’m 100% willing………………………………………..Full Article: Source

Do Sovereign Fund Direct Private Investments Deliver Value?

Posted on 25 March 2015 by VRS  |  Email |Print

As sovereign funds boost direct private equity and venture capital investment, new research suggests that they may be missing out on returns. In a recent long-term study, sovereign wealth funds’ and other institutions’ direct investments in venture capital.
Alaska Permanent Fund Corp. made direct investments totaling $128.5 million in Juno, and now its 28 percent stake is worth $1.5 billion. The allocation was a “real home run,” says APFC chief executive Michael Burns. “We’re really proud of it, but it does distort our direct investment performance, as it wasn’t the norm.” Sovereign wealth funds’ ability to deploy large amounts of capital, combined with their long-term horizons and lack of liabilities, makes them natural candidates for private equity and venture capital investments, whether they allocate directly or through external managers………………………………………..Full Article: Source

Sovereign wealth funds: What does it take to succeed?

Posted on 25 March 2015 by VRS  |  Email |Print

Norway’s sovereign wealth fund, the country’s collective bank account now valued at $1 trillion and built from off-shore oil reserves, is often held up as a prime example of how such funds can succeed. The usual rule: make prudent investments, stick to them, be transparent and watch the money grow exponentially.
But Norway’s Government Pension Fund, as it is formally called, is only one of an estimated 80 or so sovereign wealth funds worldwide that collectively hold $7 trillion US. These others probably also hold lessons for how governments can save wisely for future generations. Lessons that might apply to Alberta’s Heritage Savings Trust Fund, which began in 1976 with the best of intentions, but seems to have stalled out at roughly $17.2 billion. But rating these sovereign wealth funds, it turns out, is a subjective affair………………………………………..Full Article: Source

Hutchison to buy UK mobile network O2 for £10.25 billion, “in talks with GIC on investing in enlarged business”

Posted on 25 March 2015 by VRS  |  Email |Print

Billionaire Li Ka-shing’s Hutchison Whampoa Ltd. agreed to acquire Telefonica’s O2 unit in the U.K. for more than £10.25 billion (S$20.80 billion) to create the country’s biggest wireless provider by customers. The price includes an initial sum of £9.25 billion in cash, with the remainder to be paid when certain financial targets are met, Telefonica said Tuesday.
Hutchison is selling 30 per cent of the enlarged business, a stake it values at as much as £3 billion, people familiar with the matter said. Hutchison is in talks with investors including Singapore’s sovereign wealth fund GIC and Canada Pension Plan Investment Board, and has also held discussions with potential partners including Qatar’s sovereign-wealth fund, they said………………………………………..Full Article: Source

CIC Makes Strategic Investment in Uranium Mining Company

Posted on 25 March 2015 by VRS  |  Email |Print

Currently, China has 27 nuclear reactors under construction. The Asian giant’s nuclear programme possessed 18 GW of nuclear energy capacity in 2014, determined to hit 58 GW by 2020. The demand from China, India and the Middle East are elevating uranium prices, catching up to pre-Fukushima levels.
Perth-based Paladin Energy Ltd, a Uranium explorer and mining company, has agreed to issue US$ 50 million in senior, unsecured convertible bonds to Leader Investment Corporation, a sovereign wealth enterprise (SWE) of the China Investment Corporation (CIC). These convertible bonds issued to the sovereign wealth fund are on the same terms and conditions from the last US$ 100 million convertible bonds that were issued to clients of JP Morgan………………………………………..Full Article: Source

Social security fund reports 139 bln yuan investment yields

Posted on 25 March 2015 by VRS  |  Email |Print

China’s social security fund gained 139 billion yuan (22.7 billion U.S. dollars) from investment in 2014, with an 11.4 percent return on investment, the National Council for Social Security Fund said on Tuesday. The rate of return outperformed the 6.2-percent return rate in 2013.
Founded in 2000, the fund is designed to solve the country’s aging problem as well as being a strategic reserve to support future social security expenditure. By the end of last year, the fund’s managed assets totaled over 1.5 trillion yuan………………………………………..Full Article: Source

NZ Superfund CIO Whineray on Change and Risk

Posted on 25 March 2015 by VRS  |  Email |Print

New Zealand Superannuation Fund(NZ Super) was founded in 2001 as a means to help smooth the tax burden associated with rising universal pension costs among the island nation’s generations. Later, it helped pioneer an innovative portfolio management policy to “tilt” toward better prospects within its allocation strategy. With $21.5 billion in assets under management, the fund is viewed as an exemplar of governance and investment acumen among sovereign wealth funds.
We’ve changed that quite a lot in the last few years. We were much more traditional. Five years ago we would allocate $50 million and hope that we’d get it back plus a little bit more in 10 or 12 years. Then we changed our focus to becoming a little more opportunity-driven, we want to be able to change the amount of risk we’re allocating to an opportunity if that opportunity changes………………………………………..Full Article: Source

Sack MAS, Khazanah bosses instead of staff, unions say

Posted on 25 March 2015 by VRS  |  Email |Print

Six worker unions demanded that top officials of Malaysia Airlines (MAS) and owner Khazanah Nasional be removed in place of the 6,000 workers that will be made redundant in the flag carrier’s restructuring.
According to local business paper The Edge Financial Daily, the unions led by Tan Sri Zainal Rampak and representing up to 13,000 MAS employees said “mismanagement” on the part of MAS and Khazanah as well as their “failure to turn around the airline on numerous occasions” were reason enough for the officials to go rather than workers………………………………………..Full Article: Source

Qatar has big investment plans for India

Posted on 25 March 2015 by VRS  |  Email |Print

The Emir of Qatar, Sheikh Tamim bin Hamad Al Thani, told TOI on the eve of his summit with Narendra Modi - the Prime Minister’s first with a leader of the Arab world - that his energy-rich country wanted to invest big in India. “I know that the new government is taking a number of initiatives, especially in business and investment, which is very interesting and encouraging from our point of view. We trust the Indian economy. So we will invest in India.”
Through the Qatar Investment Authority, he holds significant stakes in such blue-chip corporations as Harrods, Barclays and Sainsbury; he also owns the famed Paris Saint-Germaine Football Club, and controversially won the right to host the 2022 football World Cup………………………………………..Full Article: Source

Qatar’s QIA to join Swiss travel retailer Dufry in bid for WDF

Posted on 25 March 2015 by VRS  |  Email |Print

Qatar Investment Authority and Swiss travel retailer Dufry are teaming up to bid for Italian travel retailer World Duty Free (WDF), which belongs to the Benetton family, two sources familiar with the matter told Reuters on Monday. “QIA and Dufry have a joint bid for WDF,” said a senior banker in Doha familiar with the matter.
He declined to give details but said the tie-up was a sign of a more conservative investment style adopted by the Qatari sovereign wealth fund recently; in the past, it might well have bid by itself. A second source confirmed the joint bid and said the deadline was now expected to be March 31, after a delay due to rival bidders - South Korea’s Lotte Group and China’s Sunrise Duty Free - asking for more time………………………………………..Full Article: Source

Norway’s Sovereign Wealth Fund Holds Lessons For Canada

Posted on 24 March 2015 by VRS  |  Email |Print

In Stavanger, a quaint, seaside city on Norway’s coast, a local newspaper publishes a series called “The Oil Kids” that reports on the lifestyles of wealthy second-generation beneficiaries of Norway’s offshore oil riches. “If you compare to our parents or grandparents which built this country, I think we’re a little bit spoiled,” admits Bjorn Knudsen, whose father worked for a large North Sea oil company.
Fifty years ago, Stavanger’s biggest industry was canning herring. Now, this city is the country’s de facto oil capital. “We are extremely lucky,” says Bjorn’s wife, Kristin Alne, a production engineer for Det Norske Olijeselsksap, an offshore oil company………………………………………..Full Article: Source

Norway’s Government Pension Fund is on top of the world

Posted on 24 March 2015 by VRS  |  Email |Print

A glance at the largest sovereign wealth fund – Norway’s Government Pension Fund Global. GPF assets have grown an annualized 20.3% in the 10 years ended Dec. 31. The fund increased its real estate allocation to 2.2% of assets in 2014 and officials say they “will continue to expand the portfolio in the years ahead.”
In its annual report, management noted strong equity returns in recent years cannot be expected to continue. That, combined with low interest rates globally “will make it a challenge for the fund to deliver similarly high returns going forward.”……………………………………….Full Article: Source

For SWFs, is “Doing Good” Bad for Stakeholders?

Posted on 24 March 2015 by VRS  |  Email |Print

Sovereign wealth funds are increasingly screening their portfolios based on so-called social criteria. Does that hurt returns? Does it change corporate behavior? And does that matter? As sovereign wealth fund assets surge, more investments are being screened for so-called environmental, social and governance (ESG) criteria. Norges Bank Investment Management (NBIM), which oversees Norway’s $861 billion.
Government Pension Fund Global announced just last month that in 2014 it had divested stakes in 49 companies, which it did not name, based upon ESG considerations, bringing the number of companies it has dumped in the past three years to 114………………………………………..Full Article: Source

Norway’s $870bn sovereign fund to invest in Asian real estate

Posted on 24 March 2015 by VRS  |  Email |Print

Norway’s Government Pension Fund Global (GPFG), the world’s biggest sovereign wealth fund, now plans to add Asian properties to its global real estate portfolio. To begin with, the $870bn (£583.5bn, €799.6bn) wealth fund will target commercial real estate in Singapore and Tokyo, according to Karsten Kallevig, head of real estate investments at the Oslo-based fund.
The focus is on specific markets rather than sectors, Kallevig told Bloomberg. Just as in purchases in Europe and the US, the fund will find partners for its planned Asian expansion, Kallevig said………………………………………..Full Article: Source

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