Weekly investor roundup: AustralianSuper to grow London and New York offices; Taiwan's PSPF emphasises ESG to external managers
TOP NEWS OF THE WEEK:
AustralianSuper will add 50 people to its London office, which will effectively double its staff, and grow its New York outfit to more than 80 people.
The London office build-out will include an in-house global equities team as the A$260 billion ($196 billion) plans to funnel up to 70% of new funds into offshore markets. The fund currently has 45% invested in Australia and 55% offshore.
These plans are part of a strategy to concentrate their business in a few, large offices rather than a number of smaller offices. The fund has no immediate plans to open an Asian office to complement its Beijing operations or branch out into mainland Europe.
AustralianSuper opened its New York office in late August after delays related to the pandemic, AsianInvestor reported in September. The fund has been hiring aggressively, particularly for private investments, with Jennie Rose being its latest hire in New York for infrastructure debt.
Source: Australian Financial Review
Public Service Pension Fund (PSPF) is putting greater emphasis on environmental, social and governance in investment mandates and manager selection, according to Ting-shi Wei, vice chairman of the NT$711 billion ($25 billion) fund’s management board.
Wei says the fund will stay focused on active ESG strategies this year, including global ESG equity mandates. “We leverage our external managers’ bespoke ESG models to have a better estimation on the investment outcome and the integration of sustainable investment factors with our investment processes,” he says in an interview with Asia Asset Management.
PSPF prefers to use broadly represented social responsibilities as benchmarks for its ESG mandates.
For internally managed investments, the pension fund takes into account the ESG assessment results of individual companies. “This will help stabilise the fund’s long-term investment return, and create a positive effect on society,” Wei says.
Source: Asia Asset Management
Government Pension Investment Fund (GPIF) of Japan has published two lists of 34 companies nominated by its external asset managers with “excellent TCFD disclosure”, it said on March 23.
The lists also included 64 companies aggregately selected for excellent disclosure of each four TCFD disclosure. TCFD refers to Task Force on Climate-related Financial Disclosures.
In a statement, GPIF said that it had requested external asset managers to nominate up to five companies with“excellent TCFD disclosure” and up to three companies each with “excellent disclosure of governance, strategy, risk management, and metrics and targets”, respectively.
Dai-ichi Life Insurance has invested 8.8 billion yen ($70.6 million) in a 10-year green bond issued by the University of Tasmania (UTAS) in Tasmania, Australia, the life insurer announced on March 24. This is the first time UTAS has issued a bond.
The proceeds raised from this bond will be used toward a campus development and construction project by UTAS. The project aims to reduce greenhouse gas (GHG) emissions in the construction of a campus, by utilising building materials with fewer GHG emissions in the manufacturing and supply process at the time of the new construction and renovation of a campus.
Source: Dai-ichi Life Insurance
A plan by UBS and China Life Insurance Group to set up an asset management joint venture in China faces uncertainty as talks have stalled due to a corruption investigation at the insurer and curbs set on the scope of the business, two sources said.
China Life's asset management arm and the Swiss bank began negotiations in late 2020 to jointly form a so-called "wealth management company" to manage money for mainly retail investors, Reuters reported in December, citing sources.
The discussions have now stalled, though they have not been formally called off, as the then Chairman of China Life Insurance Group, Wang Bin, was put under investigation by the country's corruption watchdog in January. The development has resulted in a review of planned deals initiated under Wang's watch, said the sources.
The joint venture talks faded also because the scope of business for such asset management ventures was overestimated, said the sources.
MORE INVESTOR NEWS:
Three Australian pension funds — Sunsuper, QSuper and Australian Post Super Scheme — have merged to create a new pension fund called Australian Retirement Trust. Together, the three funds will have more than $170 billion in assets under management and the new fund will be the country’s second largest retirement fund.
Sunsuper and Qsuper were the first to merge on February 28, combining their funds together to have approximately $164 billion in assets under management.
Australian Post Super Scheme has announced it will formally merge with the other two funds on April 30, bringing its $6.2 billion in aum to the Australian Retirement Trust.
According to official statements, the primary purpose of these mergers is to reduce management fees. Ian Patrick of Sunsuper will be the new fund’s chief investment officer.
Source: Chief Investment Officer
UniSuper has committed A$75 million to Uniseed. Which provides seed funding to early-stage research and technology by the Universities of Melbourne, Queensland, Sydney, New South Wales and CSIRO.
The investment will cover existing and new projects across industries such as biotechnology, pharmaceuticals, quantum computing and green energy. It also “feeds into UniSuper’s sustainable investment options”, the A$106 billion fund said in a statement.
The National Council for Social Security Fund has asked its custodians to provide more customised services and strengthen network security awareness to ensure the safe and stable operation of pension fund assets in 2022.
The national pension fund made the remarks during its latest online meeting with custodians in March, it said on March 25. They reviewed its custody business in 2021 and exchanged views on key custody services such as asset custody, account management, clearing and settlement, accounting and valuation, investment supervision, performance evaluation and information reporting.
Source: National Council for Social Security Fund
Indonesia's biggest tech firm GoTo Group is poised to raise at least $1.1 billion from its initial public offering (IPO), attracting investors such as the Indonesian units of fund managers Schroders and Eastspring Investments, sources familiar with the matter said last Thursday (Mar 24).
GoTo, which is backed by the likes of Singapore’s wealth fund GIC, SoftBank Group, and Alibaba Group, was formed last year by the merger of ride-hailing-to-payments firm Gojek and e-commerce leader Tokopedia.
The estimated $1.1 billion is in line with GoTo's target; it last week said it was offering 48 billion new eries A shares at between 316 rupiah and 346 rupiah per share.
The California State Teacher’s Retirement System (CalsSTRS) has committed $600 million in total to two Asia-focused funds.
The $318 billion US pension fund has committed $300 million each to the latest Asian investment vehicles managed by LaSalle Investment Management and CBRE, respectively.
Source: Deal Street Asia
Sumitomo Life Insurance has signed a syndicated loan agreement for Denka Company together with 10 other lenders, through a positive impact finance scheme which is arranged by Mizuho Bank, the life insurer announced on March 22.
In this syndicated loan, key performance indicators have been established for a wide range of areas, including “employment”, “waste”, “resource efficiency and safety”, “climate” and “inclusive and healthy economy”, and are expected to generate a variety of positive impacts and reduce negative impacts.
The positive impact finance scheme is based on the Principles for Positive Impact Finance proposed by the United Nations Environment Programme Finance Initiative and is a comprehensive and quantitative assessment of the environmental, social, and economic impacts (positive and negative) of corporate activities, and provides ongoing support for mitigating negative impacts and increasing positive impacts.
Source: Sumitomo Life Insurance
Nippon Life Insurance has set 2030 interim targets for greenhouse gas emission reduction in the investment portfolio, with a view to step up climate change mitigation measures in its investment activities, it announced on March 17.
In the interim targets, it pledged to reduce total greenhouse gas emissions in the investment portfolio by more than or equal to 45% compared to 2010, and reduce the intensity, or emissions per investment amount, by more than or equal to 49% compared to 2020.
These targets cover Scope 1 and 2 for domestic and foreign listed equities, domestic and foreign corporate bonds, and real estate investment in the portfolio.
Source: Nippon Life Insurance
Viva Republica, one of South Korea’s most valuable fintech start-ups, is planning to raise up to $1 billion from international investors in the second quarter to fund the expansion of its super app Toss and take on SoftBank-backed competitors Grab and GoTo in Southeast Asia.
The start-up, backed by Singapore’s GIC, PayPal, and Sequoia Capital China, raised $410 million in June 2021 at a valuation of $7.4 billion and is seeking another round of funding before launching an initial public offering. The company has raised more than $940 million in equity funding to date.
After venturing into Vietnam in 2019, where it has attracted 3 million active users with money transfer and debit card services, the company is now pushing into five other countries — Indonesia, Malaysia, Thailand, the Philippines, and India — where it will go head-to-head with Singapore’s Grab and Indonesia’s GoTo, two of the biggest technology companies in the region.
Source: Financial Times
Major financial groups in Korea will face uncertain outcomes ahead of their regular shareholder meetings this week, as the National Pension Service (NPS) is highly likely to cast dissenting votes on key proposals as the largest shareholder of the nation's top four financial holding firms.
The state-run pension fund has for years intervened in the decision-making processes of KB, Shinhan, Hana and Woori Financial Group, disapproving of such initiatives as leadership reshuffles and appointments of non-executive directors.
The industry is paying particular attention to whether the NPS will oppose Hana Financial Group's plan to change up its leadership. Hana put the proposal on the agenda for its upcoming shareholder meeting to be held on Friday.
Source: The Korea Times
Hotel deals in Korea hit a record high of 1.7 trillion won ($1.4 billion) in 2021, up 80% from the previous year, said global real estate services firm Jones Lang LaSalle in a report on March 23.
The buying and selling of hotels in Korea will reach around 1.2 trillion won this year, backed by the rising number of changes in property use, redevelopments and increased attention from overseas investors, said JLL. Also, the domestic hotel market will recover in earnest late this month as the government on March 21 began self-quarantine exemptions for entrants from overseas who are fully vaccinated, the report added.
Source: Korea Economic Daily
Time Dotcom, a Malaysian telecommunications provider that is backed by sovereign wealth fund Khazanah Nasional, is considering divesting its data centres business, according to sources familiar with the issue.
The company is currently working with financial advisers on a strategic review for Aims Data Centre that may lead to a stake sale, the sources said on condition of anonymity, adding the deal could be worth between $500 million to $600 million.
Potential bidders including industry players and infrastructure funds have expressed interest in the stake, and the company may keep a minority interest in the data centres, the sources said.
Listed on the Malaysian stock exchange since 2001, Time’s shares have dropped 7% this year, valuing the firm at $1.8 billion. The company offers fixed-line voice and broadband services to consumers and businesses, as well as enterprise solutions in areas such as cloud and security.
The jury in the trial of former Goldman Sachs banker Roger Ng accused of embezzling and laundering billions of dollars from state fund 1MDB was shown the receipt for the $23 million large pink diamond necklace that purportedly belonged to the wife of former prime minister Najib Razak.
The receipt, in the form of an invoice, was part of the evidence to prove that the necklace – apparently created by New York jeweller Lorraine Schwartz for Rosmah Mansor, Najib’s wife - was bought with money allegedly looted from 1MDB.
However, the jury was not shown the actual necklace – with the diamond said to be the size of a paperweight – or its photo during the proceedings in a New York federal court last Wednesday (Mar 23).
In winding down their case, US prosecutors were showing jurors how billions of dollars diverted from three $6.5 billion 1MDB bond transactions by Malaysian financier Jho Low were used to buy luxury items.
Singapore’s Temasek Holdings has sold off part of its stakes in Korea-based Celltrion and its distribution affiliate Celltrion Healthcare in a block deal on March 21.
The state investment firm, acting through its unit Ion Investment, reportedly raised W560 billion ($458 million) from the sale which took place after South Korean markets closed.
Celltrion explained that Temasek, its third-largest shareholder, carried out the block deal for portfolio adjustment. But analysts say that Temasek is in the process of withdrawing its investment in Celltrion Group for risk management and profit realisation.
Meanwhile, SeaTown Holdings, an indirect subsidiary of Temasek Holdings, is raising funds for its private capital fund from private investors for the first time.
The fund-raising, targeting mass-affluent investors in Singapore, is via a tie-up with digital wealth-management platform Kristal.AI, which will fractionalise the minimum investment, the platform said in a press release last Wednesday (Mar 23).
SeaTown and Temasek have committed $1 billion to the fund, with SeaTown expecting to raise another $200 million to $300 million from external investors, the release said, adding the fund will be geographically diversified, with a focus on Asia.
Source: GlobalCapitalAsia finews.asia
Jeeves, an expense management platform for startups, has raised $180 million in a funding round, that was led by Singapore’s GIC, Tencent, and US venture capital firm CRV among others, on a valuation of $2.1 billion, the company said in a statement last Tuesday (Mar 22).
Jeeves, which was launched through Silicon Valley's prominent incubator Y Combinator, develops financial structures to help high-growth startups manage expenses more comprehensively, including payroll and vendor payments, and also offer credit lines in the countries where it operates.
The company said in a statement that it will use the new investment to expand its international operations, including tapping into the Brazilian market.
Source: Business Times
Climate Impact X (CIX), a carbon exchange that is partially owned by Temasek Holdings, and carbon credit settlement platform Carbonplace, have teamed up to try and simplify trading in the nascent asset class.
The pilot scheme will use CIX’s newly launched digital platform, Project Marketplace, to execute carbon credit trades, with Carbonplace performing all settlements. The two firms will also establish a technical, legal, and operational framework for trading.
CIX is a joint venture between Temasek, DBS Bank, Singapore Exchange, and Standard Chartered to develop a global marketplace for high-quality carbon credits.
Carbonplace was developed by seven banks, including UBS, Standard Chartered, NatWest, and BNP Paribas, to provide settlement services for transactions. The platform is expected to be fully operational by the end of the year.
Source: Citywire Asia
Mapletree Investments, the property arm of Temasek Holdings, has repelled opposition to its plan to form a S$10.5 billion ($7.7 billion) real estate fund, offering an extra S$2.2 billion in cash to appease shareholders in a rare concession by the state wealth fund.
The proposed merger between Mapletree Commercial Trust (MCT) and Mapletree North Asia Commercial Trust (MNACT) – to create Asia’s seventh largest real estate trust – was first announced by Mapletree Investments in December 2021.
Last week (Mar 21), the managers of the two Temasek-linked trusts introduced an option that will allow MNACT unitholders to choose consideration in cash, in addition to the prior offer for MCT units or a combination of both cash and MCT units.
The revised offer followed public criticisms by activist fund Quarz Capital last month (February) which claimed MNACT was “significantly” undervalued. It questioned whether MNACT’s managers would have recommended the same bid had it come from a company it was not directly related to.
While the valuation of MNACT remained unchanged, the offer allayed fears that investors’ holdings would have been diluted if they remained invested.
Source: Financial Times, Reuters
Taiwan Life Insurance, an insurer owned by Taiwanese financial group CTBC Financial Holding, has made a combined capital commitment of $15 million to funds managed by Lightspeed Venture Partners.
Thailand’s Securities and Exchange Commission last Wednesday (Mar 23) announced that Bitcoin and other cryptocurrencies will be banned as a method of payment as of April 1, 2022.
While it’s not an outright ban on trading or holding digital assets, which is relatively popular in Thailand, the new rules on Bitcoin and other cryptos damage one of their key use cases as a payment alternative to cash.
The Thai financial regulator said the ban, made in consultation with the country’s central bank, was driven by risks to financial stability as well as concerns over money laundering.