Sovereign Funds Spent Another Year Hunting for Payment Fintech Plays
Global sovereign wealth funds are taking up larger stakes in the booming financial technology industry. According to the SWFI transaction database, sovereign funds like Singapore’s Temasek Holdings have been tepidly shifting out of Western banks in favor for companies like Mastercard and smaller fintech plays like Eigen Technologies, which is a London-based artificial intelligence (AI) technology platform that reads legal and financial documents. While valuations are high, confidence in the long term potential of some tech companies is strong enough to overcome the cost burden. Sovereign wealth fund managers don’t seem to mind paying a premium for a company that is likely to prosper. Saudi Arabia’s Public Investment Fund (PIF) funneled big money to the ginormous SoftBank Vision Fund which aims to target at least US$ 200 million toward financial technologies. Ibrahim Ajami, Head of Venture Capital at Abu Dhabi’s Mubadala Investment Company, opened an office in San Francisco. Mubadala perceives venture investing as a collaborative endeavor.
Fintech Payments Ecosystem
Proximity to the Silicon Valley is seen as the best way to be a part of the conversation, and to make prudent financial decisions. Payments processor Worldpay is one such investment. Worldpay processes a variety of payments online. Over 300 payment types are accepted, and Worldpay notes that US$ 40 billion in transactions pass through their systems each year. This includes payments in 146 countries. [ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]
Despite a recent downdraft in the stock market, economic signs suggest that the nation has prospered since U.S. President Donald Trump was elected. His first year was marked by mega mergers and acquisitions, and renewed hopes for deregulation and tax relief. M&A deals totaled US$ 1.2 trillion in the year since Trump was elected in a stunning upset, which compelled former U.S. Secretary of State Hillary Clinton to pen the book, “What Happened.” The total number of deals also set a record. In sum, nearly 13,000 deals have been made between the election and the end of the 2017 calendar year. Business sentiment was clearly buoyed by Trump’s election, with investors and organizations cheering the business-friendly environment to come. Unemployment dropped to a low of 4.1% in 2017, before further falling to 3.7% in 2018. This has been described as “full employment.” The unemployment rate will only fall to a certain level because there are always employees looking for something new and leaving jobs they hold. The stock market has also done well under Trump. Not since the 1960’s was volatility as low as it was during the early part of his presidency. Even with the swoon over the last several weeks, the market is still up substantially since Trump’s election. Despite consistent pessimistic headlines on major financial news sites, Amazon is still moving ahead with its massive #2 headquarters, while Google is planning a gigantic development in his core home of Mountain View, California.
Yet, controversy swirls as former U.S. President Barack Obama declared, “When you hear how great the economy is doing right now, let’s just remember when this recovery started.” [ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]
Iran Supreme Leader Ayatollah Ali Hosseini Khamenei requested the Central Bank of Iran to boost the value of the Iranian rial, according to the central bank’s governor. [ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]
UBS Trumbull Property Fund Faces Redemption, MassPRIM Benefits
Massachusetts Pension Reserves Investment Management Board (Mass PRIM) Allianz Real Estate, and Beacon Capital Partners acquired the Exchange Place skyscraper in Boston has been sold for US$ 845 million from UBS Realty Investors. UBS Realty, part of UBS Group AG, acquired the 53 State Street office tower in December 2011 from Brookfield Office Properties for US$ 610 million. Tenants of the property include Morgan Stanley, The Boston Globe, Hill Holliday, and Nixon Peabody. The property was a major holding of the open-ended fund called UBS Trumbull Property Fund.
MassPRIM will own 49% of the property.
Tower Hamlets Pension Fund Awards Equity Protection Mandate to Schroders
In September 2018, Tower Hamlets Pension Fund awarded Schroders with a mandate for a risk management solution for £700 million in an equity protection strategy. This covers about half of the fund’s portfolio of £1.4 billion. The pension fund’s consultant is Mercer.
Ebola Spreads in the Congo
The second-largest Ebola outbreak in world history has spread to Butembo, a city in eastern Congo with more than 1 million inhabitants.
NZSF Board Member Joins Board of NZX
The NZX (New Zealand Stock Exchange) board of directors named Lindsay Wright as lead independent director. She is Deputy Chair of the Board of the Guardians of the New Zealand Superannuation Fund.
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