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S&P Dow Jones Indices Launches Brazil Smart Beta Indices with BM&FBOVESPA


S&P Dow Jones Indices LLC, a provider of indices, announced a strategic agreement with BM&FBOVESPA S.A., the biggest equity and futures exchange in Latin America, on creating co-branded Brazilian indices. Index investing is a popular route for many institutional investors including pensions and sovereign wealth funds like the Alaska Permanent Fund Corporation (APFC). In April, Brazilian listed equities were generally bullish, banking on possibilities of spending cuts for Brazil’s government and accommodative monetary policy sprouting from China. A number of Gulf sovereign fund investors like the Kuwait Investment Authority (KIA) take a long-term approach to seeking value in Brazil. However, short-term investors remain concerned about a corruption scandal at Petrobras and a mounting current account deficit hitting Brazil.

According to a press release, Edemir Pinto, CEO of BM&FBOVESPA: “The agreement between BM&FBOVESPA and S&P DJI is a very important step toward increasing index based opportunities for investors and further educating them on the merits of the Brazilian capital markets. The association of our brand to S&P DJI’s on new co-branded indices will reinforce BM&FBOVESPA’s position overseas through S&P DJI’s global index distribution.”

In addition, both companies agreed to launch the S&P/BOVESPA family of smart beta indices. The five smart beta indices formed are: S&P/BOVESPA Low Volatility Index, S&P/BOVESPA Inverse Risk Weighted Index, S&P/BOVESPA Quality Index, S&P/BOVESPA Momentum Index, and S&P/BOVESPA Enhanced Value Index.

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.

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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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