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SWFI First Read, April 28, 2017

Australia’s Future Fund Rides the Bullish Wave into March 2017

As of March 31, 2017, the Future Fund reached A$ 129.6 billion in assets. David Neal, Managing Director of the Future Fund, said in a press release, “The Future Fund’s overall risk level remains unchanged and towards the lower end of our normal expectations. This reflects our view that we should only take on additional risk where the expected returns are appropriate. We continue to work hard and in a disciplined way to identify areas of opportunity, taking up those with attractive risk-adjusted returns and ensuring the portfolio is flexible and efficient.”

SEI Investments Loses to BlackRock in Bpf Meubel’s Fiduciary Mandate

Pensioenfonds Meubel (Bpf Meubel), a Netherlands pension fund for the furniture industry, named BlackRock as its fiduciary manager. BlackRock replaces SEI Investments as the fund’s fiduciary manager. In addition, SEI Investments oversees some 80% of the fund’s assets as an asset manager. In 2016, the fund had an annual return of 0.94%, as 46% of its assets are in fixed income versus 29% held in equity. In 2016, SEI Investments earned €6.5 million in its fiduciary manager mandate from Bpf Meubel.

Invesco to Buy ETF Provider Source from Warburg Pincus

Invesco is buying a majority stake in Source, a London-based exchange-traded funds (ETF) provider, from an affiliate of Warburg Pincus. Source oversees US$ 18 billion in assets, while managing US$ 7 billion in subadvised assets. Other investors holding their position in Source include Morgan Stanley, Nomura, Bank of America Merrill Lynch, Goldman Sachs and J.P. Morgan. Warburg Pincus had bought into Source in 2014. The financial advisor for Source is JPMorgan, while the legal advisor was Freshfields Bruckhaus Deringer LLP.

1MDB and IPIC Ink Conditional Agreement

Ever since the U.S. Department of Justice (DOJ) put heat on the 1Malaysia Development Berhad (1MDB) debacle, government officials from around the world involved want a faster resolution to outstanding issues. The issue between Mubadala and 1MDB encircles agreements on two bond offerings in which IPIC did not receive payment, even though 1MDB maintained they did. On April 24, 2017, 1MDB and IPIC agreed to a conditional agreement in which 1MDB would pay US$ 1.2 billion in two installments. The agreement is conditional on the Arbitration Tribunal in London. The agreement is awaiting a consent award by May 31, 2017.

RDIF and JBIC Make Progress on Key Terms for Russia-Japan Investment Fund

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SWFI First Read, December 15, 2017

Gaw Capital Sells Cross Tower Shanghai Building

Hong Kong-based Gaw Capital Partners has agreed to sell the Cross Tower, a 24-storey commercial building in Shanghai, to World Union Investment Management, for 2.66 billion RMB (US$ 402 million). The tower is located in the Huangpu district.

RDIF Portfolio Company Geopharm Plans to Increase Insulin Production

Russia-based Geopharm is a portfolio company of the Russian Direct Investment Fund (RDIF). Geopharm signed a special investment agreement with the City of St. Petersburg, Russia. Geopharm plans to invest more than 3.3 billion rubles in building a complex to meet insulin production demands.

Norway’s KLP to Exclude Companies with Oil Sands Extraction via Revenue Threshold

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NZ Super Resumes Government Contributions

The New Zealand Superannuation Fund (NZ Super) has resumed receiving contributions from the New Zealand government in the face of rising obligations as an increasing proportion of the country’s population approaches retirement. According to a statement released by the fund’s managing Board of Guardians, the government plans on investing US$ 5.3 billion into NZ Super between now and June of 2022, with the first payment scheduled for December 15, 2017.

Policymakers believe the resumption of government contributions, which were halted in July of 2009, is expected to ease the burden on the country’s current taxpayers and future generations. Withdrawals from NZ Super are expected to peak in 2078, at which point the fund will be covering 12.8% of New Zealand’s pension obligations. The new wave of contributions will initially be invested in passive, low cost equity and bond investments, according to Catherine Savage, Chair of the Guardians.

Recent Performance & Leadership Change

NZ Super has enjoyed one of its best annual performances since its founding in 2001, with a reported return of 20.7% before tax for a 12-month trailing period ended June 30, 2017, up 5 billion NZD (US$ 3.6 billion) compared to 2016. NZ Super generated 21.85% annual return in its global equities, developed market portfolio, according to its 2017 annual report.

NZ Super faces a changing of leadership in the coming year with the exit of chief executive Adrian Orr, who will leave the Fund officially in March of 2018 to serve a five-year term as Governor of the Reserve Bank of New Zealand. Mr. Orr has earned a spot numerous times in the Sovereign Wealth Fund Institute’s Public Investor 100 annual ranking over the years, most recently in 2017 at #3.

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iZettle Raises US$ 47 Million in Series E, Prepares for 2018 Listing

Card transaction platform iZettle AB has raised another US$ 47 million in Series E funding, this time with new backing from Sweden’s AP4 and early-stage venture capital firm Dawn Capital. Previous investors in the Stockholm-based payments business include American Express, MasterCard, Intel, and Spain’s Santander Group. With US$ 235 million in equity to date, iZettle is quickly approaching an estimated valuation of US$ 1 billion.[ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]

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