Archive | April, 2013

Video Interview – CA State Treasurer Bill Lockyer

This is an interview between Michael Maduell, President of the Sovereign Wealth Fund Institute and California State Treasurer Bill Lockyer at the Institute Fund Summit 2013 Americas in Dana Point, California.

Singapore’s GIC to Sell Glencore Convertible Bonds to Buy Shares

The Government of Singapore Investment Corporation (GIC) is preparing the sale of Glencore Guaranteed Convertible Bonds worth US$ 250 million. Due in 2014, the 5% convertible bonds were issued by Glencore Finance. Singapore’s GIC plans to use the sales proceeds to purchase ordinary shares of Glencore International. Singapore’s GIC was an early investor in Glencore’s […]

FSI Invests in Technicolor SA

Le Fonds Strategique d’Investissement (FSI), France’s strategic development sovereign wealth fund, purchased a stake in Technicolor SA, formerly Thomson SA. The investment was made to support the company’s plan to trim debt and augment cash flow by 2015. It is implied the FSI purchased a 1.2% stake. Technicolor SA is a 1.4 billion dollar market […]

VTB Group’s Capital Raise Draws Sovereign Funds

Russia’s second biggest lender, state-run VTB Group, is raising nearly 102.5 billion roubles (US$ 3.3 billion) in a share sale. VTB Group plans to sell 2.5 trillion new shares. With regard to sovereign fund investment, included are Norges Bank Investment Management (NBIM), the State Oil Fund of Azerbaijan (SOFAZ) and Qatar Holding LLC. The government […]

Oxford Properties Buys London Stock Exchange’s HQ

Oxford Properties Group has purchased King Edward Court, 10 Paternoster Square in London for £235 million from Mitsubishi Estate Company. King Edward Court which is 246,000 square feet houses the London Stock Exchange – their main tenant. The exchange’s lease expires in September 2028. Oxford Properties was keen on purchasing property in London’s city core. […]

Stringent Standards Compel Public Pensions to Take on More Risk

As tougher government accounting standards take hold, underfunded public pensions are poised to pile on more investment risk in order to meet their lofty annual target return. State and local governments in the United States will modify how they compute and report the costs and obligations associated with pensions. Higher return targets enable public pensions […]

First Quarter Rising Tides Assist NBIM

According to the press release, “The Government Pension Fund Global (GPFG) posted a 5.4 percent return on its equity holdings, or the equivalent of NOK 219 billion, in the first quarter. “The favourable performance reflects the strong push in equity markets, particularly in January and February. Among the major stock markets, the US and Japanese […]

Larger Investors Have Advantage in Private Equity Investing

Institutional investors have several means to gain exposure to private equity through a variety of differing liquidity and cost structures. The limited partner position investing in an externally managed fund is quite common. The “2 and 20” fee structure on committed capital has been the bread and butter for the private equity industry. Larger investors […]

Being Away from a Global Money Center

Sovereign wealth funds are influencing the disaggregation of global money centers. Fifty years ago, Dubai was a small, prosperous city in the Gulf. Fast forward, Dubai has transformed itself into a major financial center, along with Qatar’s Doha. In Sacramento, the capital of the state of California, CalPERS and CalSTRS have somewhat impacted Northern California, […]

How Oil Exporters Financially Explode

Energy resources like oil and natural gas deposits can be an economic blessing or curse. Developing economies that heavily rely on oil and other fossil fuel exports are at risk of a future financial collapse if they don’t fix or contain several risk factors. During the Middle East uprisings of 2011, the gulf countries that […]

Sovereign Wealth Believes Long-Term Viability of Gold

In mid-April 2013, there was a massive sell-off in the world gold market. Strategists at Goldman Sachs informed clients to short gold, targeting US$ 1450 an ounce. At the time gold was trading around US$ 1570 per ounce. Several of the large bullion banks had major short positions in precious metals in early January. A […]

Kuwait Investment Authority Invests in Hudson Yards Project

The Kuwait Investment Authority is investing in the Hudson Yards office property project in Manhattan. The US$ 15 billion, 26-acre office, retail and residential development project lies on Manhattan’s far West Side. It is the biggest undeveloped property in Manhattan. Getting the mega project off the ground was challenging for the Related Companies as their […]

Israel Government Re-approves Sovereign Wealth Fund

In February 2012, Israel’s cabinet publicized a plan to create a sovereign wealth fund. It was approved October 2012. The Knesset failed to get around to passing the sovereign fund law before the government fell later in 2012. In mid-April 2013, the Israeli government re-approved the creation of a sovereign wealth fund to manage profits […]

Mega NSW Ports Deal Attracts Public Investors

New South Wales (NSW) Treasurer Mike Baird announced the NSW government has successfully leased Port Botany and Port Kembla. The six month competitive bidding process of the 99-year lease of state-owned port assets Port Botany and Port Kembla has been awarded to the NSW Ports Consortium for A$ 5.07 billion. A$ 4.31 billion was received […]

Capital Inflows Return, China’s Foreign Reserves Top 3.44 Trillion

Inflows are heating up; China’s foreign reserves recorded their largest quarterly increase since the second quarter of 2011. Foreign reserves sprouted up by US$ 130 billion, totaling US$ 3.44 trillion in the first quarter of 2013. The foreign reserve increase is a reversal from 2012 when money exited China. Augmenting credit growth occurred in China […]

Norway’s Sovereign Fund Stays Course

Norway’s Government Pension Fund Global (GPFG) had their second best performance ever in 2012, generating 13.4% in returns. As Europe’s largest public equity investor, the sovereign fund returned 18.1% in equity investments. Part of the returns can be related to actions enacted by the European Central Bank (ECB) that were declared in July 2012. According […]

Deep History of Long-Term Government Bond Yield – USA

The Federal Reserve is stuck in an impasse and continues to pursue easy monetary policies, a sharp reversal from the 1980s. The purchasing of U.S. government bonds by central banks have helped interest rates reach new lows. From a central banker’s perspective, an increase in long-term rates will have dramatic implications for financial stability. Examining […]

Reflating the U.S. Stock Market

Occidental countries maintain employment of quantitative easing (QE) programs to fend off another financial drop. To prevent fallout in asset prices, central banks have played an important role in reflating risk assets. A negative spiral down in the value of assets would be catastrophic. In recent board minutes, most Federal Reserve board members believe asset […]

Abu Dhabi Investment Council and Finchatton Purchase 20 Grosvenor Square

The Abu Dhabi Investment Council (ADIC) along with Finchatton, an international property developer, purchased 20 Grosvenor Square, Mayfair for £250 million. Finchatton confirmed arrangement for them to assist in the redevelopment of 20 Grosvenor Square. A consortium led by Richard Caring, the restaurant owner-turned property developer, put 178,000 square feet worth of space for sale. […]

Sheikh Khalifa Restructures ADIA’s Board

His Highness Sheikh Khalifa Bin Zayed Al Nahyan, the Ruler of Abu Dhabi, issued an emiri decree restructuring the board of the Abu Dhabi Investment Authority (ADIA). The decree states that board members will serve a three-year term, subject to renewal. According to the decree, members of the board include: Sheikh Sultan Bin Zayed Al […]