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China’s AgBank confirms world-record IPO

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According to the AFP, “Agricultural Bank of China on Tuesday confirmed plans to raise a world-record 23.2 billion dollars in a dual initial public offering in Hong Kong and Shanghai.  The last of China’s “big four” state banks to list said it would raise the money if the monster IPO is fully subscribed when it begins on Wednesday.

Major institutional investors including sovereign wealth funds have already expressed strong interest in the IPO, which is on course to surpass the previous record of 22 billion dollars set in 2006 by Industrial and Commercial Bank of China (ICBC).  AgBank said Tuesday that it planned to raise 13.1 billion US dollars from its Hong Kong IPO, with a price range of 2.88-3.48 Hong Kong dollars (37-44 US cents) a share. Xiang Junbo, chairman of AgBank, said government efforts to boost growth in China’s depressed central and western regions would help the rural lender.

“The county area business will be one of our key profit drivers,” he told a press conference in Hong Kong on Tuesday. “(AgBank) is well positioned to capitalise on China’s next wave of growth.”

The bank, which has been criticised for the amount of bad loans on its books, has worked in recent years to chop that figure, Xiang said.

Agbank’s prospectus said its bad debt ratio dropped from 4.32 percent in 2008 to 2.91 percent in 2009.

“The bank has made substantial improvement in the last few years,” Xiang said, referring to its credit review procedures.

The newly released prospectus said AgBank booked a profit of 65 billion yuan (9.56 billion US dollars) in 2009, up from 51.45 billion yuan in 2008. It is forecasting a 2010 profit of 82.9 billion yuan. Xiang also said a stronger yuan — demanded by the United States and other trading nations which claim they have been hurt by an unfairly cheap Chinese currency — could be “positive” for AgBank.”

Read more: AFP

APG, QIC, and Swiss Life Buys MIRA Stake in Brussels Airport

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APG Asset Management, QIC (Queensland Investment Corporation), and Zurich-based Swiss Life Group, spent about €2 billion for Macquarie Infrastructure and Real Assets’ (MIRA) 36% stake in Brussels Airport. APG and QIC will each have a stake of 16.8% in the airport asset with Swiss Life having a 2.4% ownership stake. QIC will hold its airport stake in its Global Infrastructure Fund, which has third-party investors. Since 2011, the Ontario Teachers Pension Plan (OTPP) still holds a 39% stake in the airport, while the Belgian government retains a 25% ownership stake.

APG Asset Management manages assets for a number of investors including Stichting Pensioenfonds ABP.

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CIC Seeks Allies for Belt and Road Cooperation Fund

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The China Investment Corporation (CIC), which indirectly controls China’s largest banks, is seeking allies to form a cross-border investment vehicle to support One-Belt, One-Road projects – also known as the Belt and Road Initiative (BRI). The CIC is calling it the Belt and Road Cooperation Fund. The fund’s size and specific investment methods are in the preliminary phase. The BRI has been underway for the last five years.

The multi-lateral fund will be another way to funnel capital into specific belt and road projects. [ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]

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Fidelity National Information Services to Acquire Worldpay

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Jacksonville, Florida-based Fidelity National Information Services, Inc., better known by the abbreviation FIS, agreed to acquire payments processor Worldpay, Inc. for approximately US$ 35 billion (not including debt) in cash and stock, or US$ 112.12 per share. Around 19 months ago, Cincinnati-based credit card processor Vantiv, Inc. acquired Worldpay for just under US$ 10 billion, while FIS agreed to acquire First Data for US$ 22 billion in January 2019.

The combined company will keep the name FIS and be headquartered in Jacksonville, Florida. The transaction is subject to receipt of required regulatory and shareholder approvals and other customary closing conditions and is expected to close in the second half of 2019.

Deal Terms

[ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]

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