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GMR Restructures Temasek, IDFC Agreement in $183 Million Share Issue

GMR Group, the Bangalore-based infrastructure developer, announced plans last Friday to restructure investments in GMR Energy Limited made by Singapore public investor Temasek Holdings Pvt Ltd and a consortium led by Indian private equity firm IDFC Alternatives Ltd. Subject to satisfaction of conditions precedent, GMR Infrastructure Ltd will issue US$ 183 million worth of compulsorily convertible preference shares (CCPS) to Temasek and the consortium through a preferential allotment.

GMR Infrastructure will issue shares worth 7.89 billion rupees and 3.48 billion rupees to Temasek and the IDFC consortium, respectively. These investors had bought 13.95 billion rupees in CCPS of GMR Energy in 2010, and they will retain their residual investment in the company.

GMR Infrastructure gave clarification on the deal to the Bombay Stock Exchange, explaining that the new CCPS would be converted into equity shares of GMR Infrastructure between September and October, 2015. At the time of conversion, the price would be the higher of the average of the weekly high and low of the closing prices of the equity shares during the 26 weeks or the average of the weekly high and low of the closing prices quoted on a recognized stock exchange during the 2 weeks ending 30 days prior to the conversion date, as per the Securities and Exchange Board of India.

GMR Energy is valued at 60 billion rupees.

Asian Sovereign Funds Not Slowing Down on Tech Investing

According to data from SWFI’s Sovereign Wealth Fund Transaction Database, Asian sovereign funds invested US$ 6.05 billion directly into companies and assets in the information technology sector from Jan 2017 to November 22, 2017. In a comparable time frame from Jan 2016 to November 22, 2016, this same group of Asian sovereign funds directly invested US$ 5.02 billion in the sector. These are direct investments, not fund commitments or manager allocations.

Asian sovereign funds such as GIC Private Limited, Temasek Holdings and the Korea Investment Corporation (KIC) have demonstrated bullish signals to the technology community over other sectors. GIC and Temasek have also been major investors in the private side of deals, funding a wide range of tech startups, while providing financial firepower in buyout transactions.

Some notable direct tech investments in 2017 by sovereign funds include Meituan-Dianping, SoundCloud, Nets A/S, Visma AS, Turn, Inc. and Vantiv.

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Future Fund Makes a Guardian Out of Former J.P. Morgan ANZ Chair

The Australian government has appointed Robert Priestley – current non-executive chair of J.P Morgan for Australia and New Zealand (ANZ) and a non-executive director of ASX – to serve on the Future Fund Board of Guardians for a five-year term from November 7, 2017. Priestley replaces former Morgan Stanley Australia chief executive Steven J. Harker.

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Associated British Ports Reboots Property Development Arm to Capitalize on Land Bank

Associated British Ports (ABP) – operator of 21 major ports throughout the United Kingdom – has announced a reboot of its ABP Property division, complete with a new team of specialists in commercial development and logistics led by Huw Turner, in order to identify and develop strategically significant locations in its 2,372 acre land bank.

ABP is owned in large part by a consortium of pensions and sovereign funds, including the Canada Pension Plan Investment Board (CPPIB) at 33.88% ownership, OMERS at 30%, Singapore’s GIC Ventures Pte Ltd at 20.00% ownership, and the Kuwait Investment Authority at 10.00% ownership. Large institutional investors such as sovereign funds, pensions, and endowments have slowly increased allocation towards infrastructure over the past six years as an alternative to equities and bonds, according to asset allocation data from SWFI.

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