Friday SWFI News Roundup, August 1, 2014
NBIM Buys Le Madeleine from BlackRock Fund
Norges Bank Investment Management (NBIM) has bought a 100% interest in Le Madeleine. Le Madeleine is a 31,500 square meter mixed-use property on Boulevard de la Madeleine in Paris. The deal was signed on May 22, 2014 and closed on July 31, 2014. NBIM paid €425.6 million euro, with zero debt financing. BlackRock Europe Property Fund III, a closed-end fund, sold the property. AXA Real Estate will be the manager of the property.
Going East: SOFAZ Seeks Diversification
The State Oil Fund of Azerbaijan (SOFAZ) has requested approval from the People’s Bank of China to have access to indirect renminbi investments in mainland China. SOFAZ has taken steps to diversify its portfolio, including investing in overseas real estate, allocating to gold and investing in China. Gradually, SOFAZ wants to move capital toward Chinese government debt securities.
Temasek-Backed Firms Consider U.S. IPOs
Reebonz Pte, an online retailer of affordable luxury goods, is seeking to go public and list on NASDAQ. Razer Inc, a company that develops computer hardware for video game fans, is planning to go public and is working with Credit Suisse. Both firms are backed by Singapore’s Temasek Holdings.
Societe Generale SA Postpones Islamic Bond Offering
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Banking behemoth J.P. Morgan Chase disclosed its own digital currency called JPM Coin. The digital token will be used to settle payments between clients. JPM Coin will be backed by physical U.S. dollars and be based off Quorum. Quorum is J.P. Morgan’s private Ethereum-based chain. JPM Coin plans to compete with Ripple, which created XRP, another digital currency that is used for settlements. Ripple’s main target market is cross-border payments and remittances.
The Central Bank of the United Arab Emirates and the Saudi Arabian Monetary Authority have unveiled their plans for Aber, an interbank digital currency. Both banks have indicated that Aber will be limited to financial settlements using distributed ledger technologies. It will be rolled out on a probational basis, and used by select banks within the two countries. A date for rollout has not yet been declared. A joint statement hinted at a broader application of the currency in the days ahead. If “no technical obstacles are encountered, economic and legal requirements for future uses will be considered.” Blockchains and Distributed Ledgers technologies will be employed. The plan is for ‘Proof-of-Concept’ testing, which involves studying and fully comprehending the ways modern technologies can achieve practical applications. The digital currency has the potential to become a reserve system for central payments.
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La Française and Canada Pension Plan Investment Board (CPPIB) formed a strategic partnership for the launch of a real estate investment and development vehicle: Société Foncière et Immobilière du Grand Paris. The joint venture between CPPIB (80%) and Caisse Fédérale du Crédit Mutuel Nord Europe (CMNE) (20%), La Française’s shareholder, will invest in major real estate projects linked to the Grand Paris infrastructure in the Greater Paris area. The parties will initially allocate €387.5 million in equity to the venture. The partnership will target regeneration and infrastructure-led investments.[ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]
Øystein Olsen, the Governor of Norges Bank, which oversees the Norway Government Pension Fund Global (GPFG), voiced his opinion on the Norwegian government’s plans to alter the rules that regulates the country’s SWF withdrawal rules in certain circumstances. The coalition government led by Norwegian Prime Minister Erna Solberg wants to relax the limits on SWF withdrawals in specific cases. Norway’s government seeks to raid the fund to pay for the replacement of four major state buildings impacted by a terrorist attack and a crashed Royal Norwegian Navy frigate (KNM Helge Ingstad).
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