TOP NEWS OF THE WEEK
Canadian insurer Sun Life Financial’s investment arm is considering the launch of a second environmental, social and governance (ESG) fund in Hong Kong following the strong performance of its first fund according to Stanley Ngan, chief executive officer of Sun Life Asset Management (HK).
The first fund — Sun Life AM Hong Kong ESG Index Fund — was launched in November 2020 tracks the Hang Seng ESG 50 Index. The fund is an investment option in the company’s Mandatory Provident Fund (MPF) schemes.
Ngan believes ESG investing will remain a key theme for investors globally in 2022, and said that his company is exploring the feasibility of launching another ESG fund in Hong Kong this year. Sun Life Asset Management is the third largest manager in the HK$1.18 trillion (US$151.2 billion) MPF market.
Source: Asia Asset Management
National Pension Service (NPS) has lowered its exposure to large-cap and other domestic shares in 2021 in an apparent bid to boost returns and diversify its portfolio, a corporate tracker said on Jan 19.
NPS held stakes of 5% or more in 265 companies listed on Korea’s bourses as of the end of 2021, down 10 from a year earlier, according to CEO Score. By end-2021, the value of NPS stakes in the 265 large-cap firms came to 154.6 trillion won ($129 billion), down 5.9% from a year earlier.
It increased holdings of shares in pharmaceutical and bio companies, while reducing stakes in IT, electric and electronics firms.
Source: Yonhap News Agency
Singapore’s first blank check company started trading on the country’s stock exchange on Jan 20, four months after the bourse launched new rules allowing special purpose acquisition companies (Spacs) to list.
Vertex Technology Acquisition Corporation (VTAC), is sponsored by Vertex Venture Holdings, a wholly-owned subsidiary of state investor Temasek Holdings. The Spac’s IPO of 11.8 million units had an offer price of $5 Singapore dollars. The retail tranche of 600,000 units was 36 times subscribed.
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Australia’s Construction & Building Unions Superannuation Fund expects to more than double its assets to $108 billion over the next three years by acquiring rival pension as regulator scrutiny in the country forces smaller firms to exit the market.
The Melbourne-based pension fund with over $47 billion in assets under management, is in discussions with like-minded firms to help will help it achieve this goal, according to its Chairman Wayne Swan.
A series of regulatory reviews has found that Australia’s super industry is currently plagued by many poorly-performing funds and high fees. As a result, the number of firms managing the country’s $2.43 trillion in retirement savings is expected to shrink by more than half within the next decade.
Australia’s prudential regulator has warned Westpac Banking Corp., Aware Super and Insignia Financial Ltd. to improve their performance in some plans, and has told two others funds to merge with larger and better-performing rivals.
State-owned China Central Television (CCTV) recently broadcasted a documentary claiming that the brother of the former Chinese Communist party head of Hangzhou – an eastern city and home of Ant Group’s headquarters – had received payments in exchange for policy incentives and discounted real estate.
Zhou Jianyong, younger brother of ex-state official Zhou Jiangyong who was arrested in August over corruption claims, allegedly received «unreasonably high payments» from private companies, including Ant Group, which were followed up by a return of incentives.
Hong Kong-based ESR Cayman has acquired Singapore’s ARA Asset Management for $5.2 billion, a move that it says makes it the largest property investment firm in Asia Pacific and the third largest listed real estate manager in the world, with $140 billion of assets.
It purchased the firm from ARA’s shareholders, including Hong Kong billionaire Li Ka-shing’s CK Asset Holdings, and Singapore’s Straits Trading.
ARA, which had around $95 billion of assets under management as of June 2021, primarily invests across traditional and new economy real estate sectors spanning office, logistics, retail, residential and hospitality assets.
Source: Asia Asset Management
India's HDFC Capital, a private equity investment manager, said on Sunday it has raised $1.8 billion from investors, lead by a unit of sovereign wealth fund Abu Dhabi Investment Authority (ADIA), for its third low-cost housing fund.
This includes an upfront amount of $1.2 billion with an additional $600 million committed towards reinvestment of the principal amount, the company said in a statement.
HDFC Capital Affordable Real Estate Fund 3 will provide long-term finance to develop about 280 million square feet of affordable and mid-income housing projects across India. It will also invest in low-cost housing-related technology companies, it said.
Sovereign wealth funds (SWFs) are increasing their focus on sustainability-centred products. Their involvement comes as investors continue to push asset managers to take environmental, social and governance (ESG) factors into consideration in search of better returns.
SWFs' investments in the ESG space globally surged 215.3% in 2021 to $22.7 billion, from $7.2 billion the previous year, revealed the data acquired by Finbold - a financial news platform. Over the same period, the number of deals increased from 19 to 37. In 2019, their investment stood at $5.2 billion.
Source: Business Standard
GLP, the Singapore-based global real estate logistics developer and investment manager, announced a final close for its GLP Japan Development Partners IV fund at $3.57 billion on Jan 19.
According to a GLP news release, the $3.57 billion in commitments for the latest round came from a diversified group of pension funds, sovereign wealth funds and insurance companies from North America, Asia and the Middle East.
The fund, launched only three months before in October 2021, has twice been oversubscribed at more than $5.27 billion. When fully deployed, with leverage, the fund is expected to have assets under management of more than $9 billion.
In October, the Canada Pension Plan Investment Board announced it had committed almost $1 billion to the fund.
Government Pension Investment Fund (GPIF) has changed the procedures for its Asset Manager Registration System for traditional assets to simplify the management recruitment process and encourage more applications from new managers, it announced on Jan 21.
Changes in the new system include that GPIF can access asset managers’ strategy if they are registered in the eVestment database, and thus will not be required to regularly update performance data.
Existing registrations are only valid until the end of this fiscal year in March; applicants that wish to continue registration from next fiscal year onward are required to re-register through the new procedure.
Sumitomo Life Insurance has invested A$120 million ($85.9 million) in a 10-year sustainability bond for Dutch social housing issued by Dutch state-owned BNG Bank to support the Netherlands to improve social housing conditions, the life insurer said on Jan 21.
The proceeds of the bond will be used to provide affordable rental housing for people with lower socioeconomic status. They will also be utilized for lending to all sustainable development goals-linked loans of Dutch Social Housing Associations, as defined in BNG Bank's sustainable finance framework.
Source: Sumitomo Life Insurance
Pension Fund Association for Local Government Officials, or Chikyoren, has hired BlackRock Investment Management for an overseas private debt mandate of unspecified value. BlackRock Japan will be providing the investment services locally, it said in an announcement on Jan 18.
This is Chikyoren’s fifth global private debt mandate since the pension fund began investing in the asset class in 2019. The previous four were outsourced to Barings Asset Management (Japan), UK bond manager BlueRay Asset Management, US alternatives manager Angelo, Gordon & Co, and Nomura Asset Management.
National Pension Service (NPS) expanded the mandate of BNY Mellon to provide data-centric securities services to help transform NPS’s operating model across the front, middle and back office, BNY Mellon announced on Jan 20.
BNY Mellon has become NPS’s global custodian for its fixed income investment since 2018. The data solutions platform, called BNY Mellon OMNI, will improve operational efficiencies, and help manage increasingly rapid changes in investment and regulatory complexities, as NPS expands its global footprint across key financial hubs in London, New York and Singapore, BNY Mellon said.
Source: BNY Mellon
Korea Scientists and Engineers Mutual-aid Association (SEMA) is looking to hire two local fund managers for a 250 billion won ($209 million) global multi-asset mandate which may be structured as either a fund of funds or a discretionary account.
The mandate has a global tactical asset allocation strategy and the managers will primarily be responsible for choosing international sub-managers, performance evaluation and portfolio adjustment, SEMA says in a request for proposal on January 18.
SEMA, which invests the pension contributions of more than 75,000 scientists and engineers, has around $6.2 billion of assets under management.
Source: Asia Asset Management
The Philippine Life Insurance Association (PLIA) has named Rico T. Bautista (pictured above), CEO of Etiqa Life and General Assurance Philippines, as its new president.
PLIA is a non-profit industry organisation representing life insurance companies in the Philippines. It currently has 31 member companies.
Bautista said that, as president, he will work with the organisation and its members in “protecting the lives of Filipinos while providing financial security, including health, savings and investments instruments.” This includes making insurance more relevant and accessible for Filipinos.
Source: Insurance Business Asia
Temasek Holdings is nearing a deal to buy testing company Element Materials Technology from buyout firm Bridgepoint Group Plc for almost $7 billion, people familiar with the matter said. Temasek, which is already a minority owner in the business, could announce an agreement as early as Monday.
U.K.-listed private equity firm Bridgepoint began exploring a sale late last year. Temasek preempted a bidding process that was expected to draw interest from other buyout firms as well as strategic investors. Cinven and the Canada Pension Plan Investment Board were among parties reported to be interested.
While talks are advanced, as with all deals, an agreement could still be delayed or fall apart.
GIC is jointly leading a roughly $200 million fundraising for London-based grocery delivery platform Zapp, which launched 18 months ago, according to sources.
Sources said the new capital would also include contributions from existing investors Lightspeed Venture Partners and 468 Capital, two major backers of early-stage companies. Zapp's fundraising has yet to close but could be announced as soon as next month.
Source: Sky News
Private equity giant TPG's Novotech Health Holdings raised fresh financing valuing the business at $3 billion, as it considers another run at an initial public offering (IPO) after a deal was pulled last year.
The transaction, backed by existing shareholders including Sequoia Capital and GIC, raised $255 million in equity through a private placement, according to a Novotech statement on Jan 19. The clinical research and testing provider also refinanced $505 million of debt that was due to expire next year.
Source: Business Times
Around half of, or one million members of the National Savings Fund (NSF) have stopped making contributions to the fund due to their declining income caused by prolonged Covid-19 pandemic, said the fund's secretary-general Jaruluk Ruangsuwan.
The fund has around two million members. They are workers aged 15 and above and are not members of the social security fund, the government pension fund or the provident fund. Despite this stoppage of contributions, the fund still gained 60,000 new members last year.
NSF manages 10 billion baht ($303 million). Last year it invested most of this on highly stable assets, with 7% invested in stocks.
Source: Bangkok Post
GLP, the Singapore-based global real estate logistics developer and investment manager, announced the establishment of GLP Vietnam Development Partners I (“GLP VDP I”) with an investment capacity of $1.1 billion on January 21.
Through the transaction, GLP has received commitments from a diverse mix of pension funds, sovereign wealth funds and insurance companies across Asia, Europe, North America and the Middle East including new investors Dutch pension fund manager APG Asset Management and Toronto-based global financial services provider Manulife.
GLP VDP I, will focus on developing modern and environmentally-friendly logistics facilities in Greater Hanoi and Greater Ho Chi Minh City, and is seeded with six development sites with a total land area of close to 900,000 square metres and has a robust development pipeline of further opportunities. It is set to be one of the largest logistics development funds in Southeast Asia.