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Temasek Holdings Buys Stake in Repsol SA

Singapore’s Temasek Holdings increased their stake in Repsol SA. Repsol is Spain’s largest oil company; they recently announced the sale of their liquefied natural gas assets to Royal Dutch Shell Plc for US $4.4 billion cash excluding debt. Temasek Holdings purchased 5.04% of treasury shares (64.7 million shares at € 16.01) from Repsol for 1.68 billion SGD (US$ 1.35 billion). Temasek Holdings now holds a 6.3% stake in Repsol.

Temasek Holdings has been steadily augmenting their portfolio in the energy sector, backing both emerging companies and established players.

Tay Sulian, managing director of investment at Temasek Holdings, said: “The investment in Repsol deepens our exposure to the energy sector through a high quality growth-oriented company.”

He added, “The sector is a good proxy for the needs of transforming economies and growing middle-income populations, both of which are part of Temasek’s investment themes. We are pleased to have the opportunity to invest in Repsol, and will continue to look for good, long-term investments in the energy space.”

In May 2012, the government of Argentina’s nationalization of YPF SA exerted stress on Repsol’s financial health. Repsol’s credit rating was on the verge of junk status, a major risk for a capital intensive industry.

For Repsol, the deal with Temasek Holdings was discounted causing a €148 million cash loss for the company. On the other hand, the deal should have a positive impact on the company’s credit rating, while increasing the stability of their balance sheet.

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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