Sovereign Wealth Fund Institute » CIC

CIC to Invest in EIG Global Energy Partners

Web Director — Thu, 02 Feb 2012 06:47:58 +0000

EIG Global Energy Partners, LLC (EIG), an institutional investor in the global energy sector, has reached a definitive agreement with the China Investment Corporation (CIC). The CIC is in agreement to purchase a minority stake in EIG. The CIC is an investor in EIG-managed funds.

The China Investment Corporation is betting big on natural resources, energy, and global infrastructure. By investing in an asset manager that specializes in energy and infrastructure, the CIC could potentially learn and benefit from possible expertise and robust deal flow.

Separated in January 2011, EIG was formerly the Energy & Infrastructure Group at Trust Company of the West (TCW). The CIC has also invested in Chesapeake Energy Corporation. In November 2011, Chesapeake sold EIG $500 million of perpetual preferred shares of a newly formed entity, CHK Utica, L.L.C.

China Investment Corporation Invests in Thames Water

Web Director — Fri, 20 Jan 2012 17:25:19 +0000

In December 2011, the Abu Dhabi Investment Authority purchased 9.9% of Kemble Water Limited, the holding company of Thames Water. The private regulated utility company is responsible for the public water supply and waste water treatment in parts of Greater London, Thames Valley, Surrey, and other areas. The utility is regulated by the Office of Water Services.

The China Investment Corporation (CIC) through a sovereign wealth enterprise (SWE) made its first major move into UK infrastructure buy purchasing an 8.68% stake in Kemble Water.

Earlier, CIC chairman Lou Jiwei indicated the CIC’s interest in European and American infrastructure.

CIC Makes a Play in South Africa’s Shanduka Group

Web Director — Thu, 22 Dec 2011 18:07:08 +0000

South Africa has been a key investment destination for China due to its natural resources, lower political risk profile compared to other African nations, and growing demographics. In fact, the China-Africa Development Fund has been an active investor in the country. The China Investment Corporation (CIC) will purchase a 25% stake in the Shanduka Group for 2 billion rand (US$ 245 million). Johannesburg-based Shanduka is led by former secretary-general of the ruling African National Congress Cyril Ramaphosa and has investments in McDonald’s franchises and coal. It is an unlisted holding company. Recently, the Shanduka Group gained majority control of a coal venture that it operates with Glencore. It increased its stake in Shanduka Coal from 30% to 50.01%, giving it control. Shanduka’s coal mining operations include Springlake, Middleburg Townlands, and Graspan.

The CIC is buying the shares mostly from Investec and Old Mutual Private Equity. Standard Bank was the exclusive financial advisor for the Shanduka Group.

“This partnership will allow us to jointly explore future investment opportunities in South Africa and other parts of Africa,” Ramaphosa said in the statement regarding the recent transaction.

China Investment International (Hong Kong) Co., Limited On Course to Be Fully Functioning

Web Director — Thu, 03 Nov 2011 17:18:18 +0000

According to a press release, ” China Investment Corporation (CIC) has completed a set of preparatory work to put China Investment International (Hong Kong) Co., Limited (hereafter referred as “CIC International (Hong Kong)”), a wholly-owned subsidiary of CIC, on course to be a fully functioning institution with senior managers appointed.

CIC International (Hong Kong) will take a market-based approach under the principle of measured progress and professional commitment, in accordance with well-defined investment and risk management strategies guided by its clear mandate.

The primary business of CIC International (Hong Kong) covers equity investment and bond investment on the public market, non public market investment and economic research.

Mr. Fan Kungsheng is appointed as President of CIC International (Hong Kong).”

Source: China Investment Corporation Press Release

China Investment Corp Meets with Italian Finance Ministry

Web Director — Wed, 14 Sep 2011 08:48:32 +0000

Giulio Tremonti

Like other Southern European nations, Italy is suffering from severe sovereign debt issues. The Italian Ministry of Finance met with the China Investment Corporation to discuss possible scenarios. Recently, investors wanted greater returns and drove up the bond auction. Italy is trying to lower soaring interest rates and introduce austerity measures. [Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view site content.]

China Investment Corp Invests in Vietnamese Coal-Fired Plant

Web Director — Wed, 31 Aug 2011 07:58:30 +0000

Investing in new energy infrastructure is a blossoming area for many sovereign investors. There are numerous risks inherent in these types of projects such as political risk, financing risk, and developmental risk. In the past, the China Investment Corporation (CIC) has invested in AES Corp. stock. AES Corp. and the CIC have partnered strategically and financially. Recently, the CIC and AES Corp have partnered in a Vietnamese infrastructure project. By partnering with the China Investment Corporation and Posco, AES Corp has lowered political risk in the project, since the deal is involving foreign governmental investors. Vietnam has a growing economy in which energy demand has exceeded supply. Energy generation capacity is trailing behind demand.

After completion this will be the biggest private sector power plant in Vietnam and will set precedence for future foreign investment in Vietnamese infrastructure.

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CIC Launched 2010 Annual Report

Web Director — Tue, 26 Jul 2011 16:47:50 +0000

The press release states, “On 26 July 2011, with the approval of its Board of Directors, China Investment Corporation (CIC) released Annual Report 2010 (hereafter referred to as “annual report”), the third annual report by CIC since its inception.

The annual report, consisted of Overview, Culture and Core Values, Corporate Governance, Investment Strategy and Management, Risk Management, Human Resources, Outreach Activities and 2010 Financials, provides comprehensive information on CIC’s operation and major progress in the year of 2010.

In 2010, CIC reduced its cash holdings as a proportion of total portfolio and further diversified its investment portfolios. The return on its global investment portfolio was 11.7% in 2010 and the cumulative annualized return was 6.4% since its inception.

Mr. Lou Jiwei, Chairman & CEO of CIC said in his message for the annual report that 2010 was a year of substantial growth and accomplishment for CIC. As CIC fully deployed the investible capital in its global portfolio, it continued to develop its organization and build its institutional capabilities. CIC earned a satisfactory return for its shareholder and continued to manage the risk profile of its invested portfolio effectively.”

SMIC to Receive Investment from CIC

Web Director — Tue, 19 Apr 2011 08:48:49 +0000

According to the press release, “Semiconductor Manufacturing International Corporation (“SMIC”; NYSE: SMI; SEHK: 0981.HK), China’s largest and most advanced semiconductor foundry, announced today a definitive investment agreement between SMIC and China Investment Corporation (CIC). Under the terms of the agreement, CIC will invest US$250 million in SMIC, acquiring 360,589,053 convertible preferred shares at HK$5.39 per convertible preferred share. After issuance and conversion of the new shares, CIC will own approximately 11.6% of SMIC’s outstanding share capital. The agreement also provides CIC with warrants for investing an additional US$50 million in SMIC on the same terms, and entitles CIC to nominate one member of SMIC’s board of directors.

“We are very pleased with our new partnership with CIC,” said Dr. Jiang Shangzhou, Chairman of SMIC. “Their investment in SMIC provides a source of capital that allows us to take full advantage of our project pipeline. Partnering with CIC is conducive to realizing our development objectives and enhancing our competitive advantage in the international arena. We welcome this investment from CIC.”"

CITIC Capital Close of Second Japan Buyout Fund and Two New Investments

Web Director — Tue, 15 Mar 2011 14:47:24 +0000

According to the press release, “CITIC Capital Partners, the private equity arm of CITIC Capital Holdings Limited (“CITIC Capital”), today announces the successful closing of its second Japan buyout fund CITIC Capital Japan Partners II, L.P. (“CCJP II”) and the closing of two new investments, Higashiyama Film Co. Ltd. and Tri-Wall K.K. CCJP II has secured total capital commitments of over JPY18 billion. Similar to its predecessor fund, CCJP II targets buyouts of middle-market Japanese companies, particularly those with substantial operations or growth potential in China.

Mr. Yichen ZHANG, Chief Executive Officer of CITIC Capital, stated: ‘We are delighted by the strong support we have received from both existing and new investors. We believe their support is a validation of the tremendous investment opportunity which exists to assist outstanding Japanese companies in their international expansion, particularly to China. We look forward to continuing to build our Japan franchise and to delivering strong China value-added to our first two investments in this new fund.’”

CIC joins with Blackstone Group LP to Purchase Discounted Japanese Property Loan Portfolio from Morgan Stanley

Web Director — Mon, 21 Feb 2011 09:55:22 +0000

Morgan Stanley Real Estate was founded in 1969. In 2006, institutional investors were lining up in droves to invest in Morgan Stanley’s real estate funds (MSREF). In fact, MSREF V generated so much investor demand that it raised almost 4x the amount of the MSREF IV Domestic Fund in 2000. Several of the larger sovereign wealth funds involved in non-strategic investment strategies were allocating even more to core real estate at this time. High IRRs and portfolio diversification made the investment story real. Investors were attracted by the hefty IRRs generated by the earlier funds, especially the risky opportunistic real estate funds. For example, the Irish National Pensions Reserve Fund invested in MSREF V (Domestic).[Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view site content.]