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Asian Sovereign Wealth Fund May Purchase Blackstone Stake in Broadgate Estate

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In early 2013, the Blackstone Group hired Eastdil Secured and Bank of America Merrill Lynch to assist in selling their interest in the Broadgate Estate. Blackstone has a 50% interest in the massive 16-building complex in London’s financial district.

The Blackstone Group bought the 50% stake in 32-acre Broadgate Estate from London-based real estate investment trust British Land in 2009 in times of great economic instability. The assets were purchased through real estate funds Blackstone Real Estate Partners Europe III and Blackstone Real Estate Partners VI. The private equity firm paid £77 million for the shares – but assumed 50% of the £1.97 billion debt which is secured against Broadgate. Broadgate was valued at £2.16 billion on August 31, 2009.

British Land needed to do the deal at the time to increase financial flexibility such as reducing necessary capital expenditures on certain properties. Broadgate was 27% of British Land’s portfolio, dropping to 16% immediately after the transaction.

The deal had in November had a number of provisions at the time which include Blackstone agreeing not to sell the property for at least three years after purchase. Another significant provision is that British Land had the option to prevent certain parties from buying the newly acquired interest. British Land remained as the administrator and asset manager.

Why is Broadgate interesting for a sovereign wealth fund?[ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]

Google Fined Big Time by EU Regarding Antitrust Violations

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The European Union (EU), through its competition commissioner, levied a €4.34 billion fine against Alphabet Inc., the owner of Google. The fine is over Google having “imposed illegal restrictions on Android device manufacturers and mobile network operators to cement its dominant position in general internet search,” according to the European Commission (EC).

The European Commission is requiring Alphabet to cease from its conduct that it is accused of within 90 days or face penalty payments of up to 5% of the average daily worldwide turnover of Alphabet, Google’s parent company.

Commissioner Margrethe Vestager, in charge of competition policy, said in a press release, “Today, mobile internet makes up more than half of global internet traffic. It has changed the lives of millions of Europeans. Our case is about three types of restrictions that Google has imposed on Android device manufacturers and network operators to ensure that traffic on Android devices goes to the Google search engine. In this way, Google has used Android as a vehicle to cement the dominance of its search engine. These practices have denied rivals the chance to innovate and compete on the merits. They have denied European consumers the benefits of effective competition in the important mobile sphere. This is illegal under EU antitrust rules.”

The EC press release added, “In particular, Google: 1. has required manufacturers to pre-install the Google Search app and browser app (Chrome), as a condition for licensing Google’s app store (the Play Store); 2. made payments to certain large manufacturers and mobile network operators on condition that they exclusively pre-installed the Google Search app on their devices; and 3. has prevented manufacturers wishing to pre-install Google apps from selling even a single smart mobile device running on alternative versions of Android that were not approved by Google (so-called “Android forks”).”

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Mubadala, RCIF and UFC Agree to Form UFC Russia Joint Venture

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Endeavor (formerly WME | IMG) is taking its UFC brand into Russia. Endeavor is financially-backed by investors such as Silver Lake Partners, CPPIB, KKR and Singapore’s GIC Private Limited. The global talent agency company inked a deal with the Russia-China Investment Fund, Mubadala Investment Company (UAE) to form a platform to focus on the development and expansion of UFC’s mixed martial arts (MMA) business in Russia and CIS countries. [ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]

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ValueCAP CEO Steps Down at End of July

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ValueCAP’s CEO, Sharifatu Laila Syed Ali, is stepping down at the end of July 2018. She has a 16-year tenure at ValueCAP (Valuecap Sdn. Bhd.), joining the company in 2002. She is being replaced by Rosalina Rahman. Expected to be joining ValueCAP in August, Rahman is currently a Managing Director of Amundi Asset Management’s Malaysia unit. [ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]

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