DATA: Sovereign Funds Slowed UK Direct Investments Before Brexit Vote

There was a significant reduction in direct investments in England by sovereign wealth funds prior to the Brexit vote.


Post-Brexit, the United Kingdom experienced a bump in sizable deals in September 2016 by sovereign funds and foreign pensions. One such deal was Singapore’s GIC Private Limited partnering with student accommodation company GSA to buy a large £700 million portfolio of student beds from Oaktree Capital Management. Is it conclusive that sovereign investors minimized direct investment activity due to an upcoming Brexit vote event? There are other factors at play, such as Middle East sovereign funds, in the aggregate, slowing down on direct investments, while shoring up cash due to the oil glut. Gulf countries are under pressure to keep their fiscal houses in check as oil income has plummeted over the past year. In fact, the Abu Dhabi Investment Authority (ADIA) had shuttered its London office.

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Sovereign Wealth Fund Transactions: The Numbers

According to data from SWFI’s Sovereign Wealth Fund Transaction Database, wealth funds directly invested US$ 7.47 billion into the United Kingdom in the first quarter of 2016, versus US$ 3.24 billion in the second quarter of 2016. [ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]

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