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In Talks of Privatizing Greek Public Assets to Long-Term Investors

The government of Greece is planning to privatize assets and allow concessions in order to reduce sovereign debt obligations owed by Greece and create jobs. Foreign investment in real estate development or infrastructure concessions could contribute to Greece’s gross domestic product.

The assets and rights owned by Greece can be summed into three categories

  • Shares (Listed or Unlisted)
  • Rights (Licenses or Concessions)
  • Real Estate Property (Land or Buildings)

Created on July 1, 2011, the Hellenic Republic Asset Development Fund (HRADF) exists to facilitate Greece’s privatization policy and execute transactions.

According to the website, “The Fund is a “societe anonyme”, of which Hellenic Republic is the sole shareholder with a share capital of €30 million. The Fund is not a public entity and is governed by private law. The assets transferred to it by the State do not form part of its share capital.”

The goal is to maximize the proceeds to the country of Greece. Projected proceeds to the HRADF hope to total €50 billion. This is the amount the government of Greece has put on the total market value of commercially exploitable assets. About 70% of the €50 billion is mostly in real estate. The HRADF is targeting long-term active investors with significant risk appetite for the Greece privatization plan. By 2014, the HRADF hopes to sell virtually all Greek corporate and state monopolies, leaving key infrastructure assets under public control. With regards to real estate investments, the HRADF is targeting developers and other institutional real estate investing vehicles.

SouthGobi’s CEO Arrested, CIC Struggles with Investment

The China Investment Corporation (CIC) has long struggled with its investments in coal assets, specifically in globally-listed coal miner SouthGobi Resources Ltd, which operates its flagship coal mine in Mongolia. In November 2009, CIC and SouthGobi Resources inked a convertible debenture deal. [ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]

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Qatar Central Bank Deals with MSCI

MSCI, a stock index company whose benchmarks influence investor behavior, has tremendous indirect power impacting the stock markets of smaller economies. In 1988, MSCI released its emerging markets index, a now-widely-used benchmark for many institutional investors wanting access to growth markets. China and South Korea make up the majority of the benchmark, but smaller economies such as Poland, Chile and even Qatar make up other pieces of it.

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

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bcIMC Buys into Bottling Business with PAI in €1.623 Billion Takeover of Refresco

Dutch soft-drink bottler Refresco Group N.V. has agreed to a buyout offer for all 81.2 million of its shares from French private equity firm PAI Partners SAS (PAI) and Canadian pension manager British Columbia Investment Management Corporation (bcIMC) in exchange for €20 in cash per ordinary share for a total consideration of €1.623 billion. Refresco’s major shareholders, which includes 3i Group, and shareholding members of its boards, who represent 26.5% of outstanding shares, have said they stand behind the deal.

Refresco’s board rejected an initial offer from PAI in April 2017 of €1.4 billion, which they felt did not adequately capture the value added by their plans to bolster its presence in North America through the acquisition of Canadian bottler Cott TB, a deal that went through in July for US$ 1.25 billion.

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

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