Weekly investors roundup: Temasek, Adia joins China biotec fund-raise; NGS Super divests fossil fuel assets; KIC eyes new CIO
TOP NEWS OF THE WEEK
Singapore state investment fund Temasek and the Abu Dhabi Investment Authority (Adia) participated in China-based biotech firm Sironax’s $200 million Series B funding round.
The fund raising was led by Gaorong Capital and Yunfeng Capital. With the closing of this round, Sironax has raised over $300 million to date.
Sironax plans to use the proceeds to support the ongoing clinical development of its portfolio of receptor-interacting serine/threonine-protein kinase 1 (RIPK1) inhibitors in addition to the continued expansion of its R&D footprint and pipeline of potential best- and first-in-class candidates for age-related degenerative diseases.
Source: Sovereign Wealth Fund Institute
Industry super fund NGS Super has divested from oil and gas exploration and production companies including Woodside and Santos as it works towards a carbon-neutral portfolio by 2030.
This divestment of approximately $191 million (as at 31 May 2022) has been redistributed to other holdings within the fund’s equities portfolio.
The exclusion is an expansion of earlier restrictions the fund had on holding companies that generate more than 30% of revenue from distribution, power generation, or extraction of thermal coal. It has been applied in all investment options offered by NGS Super except for the Indexed Growth investment option.
Source: NGS Super
Lee Hoon, head of strategy and innovation, will be promoted as the chief investment officer of Korea Investment Corporation (KIC), overseeing the management of the sovereign wealth fund through investments in traditional and alternative assets.
The Korean government on Thursday August 4 notified KIC of its decision to promote Lee. The appointment needs to be approved by the steering committee of the independent sovereign wealth fund.
Lee has been with KIC since 2017 and heading the strategy and innovation division since August 2021. If approved, Lee will take office after CIO Park Dae-yang, whose term ended on August 4, for three years.
Source: Mail Business News Korea, The Korea Economic Daily
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AUSTRALIA
The Australian Investment Council has appointed Navleen Prasad as chief executive officer after an extensive global search for the role. Prasad commences in the position in early November.
She joins from Macquarie Group where she was employed for 19 years in a number of roles, the most recent being head of government and external relations.
She replaces Jonathan Kelly who has been interim CEO since April 2022, when eight-year CEO Yasser El-Ansary stepped down to join the Financial Services Institute of Australasia.
Source: Australian Investment Council
CHINA
Insurance giant AIA Group is in talks to purchase an office at a prime location in Shanghai as it expands business in China, according to people familiar with the matter.
The Hong Kong-based insurer is considering buying SIIC Centre, a multi-function project under construction near Shanghai’s North Bund area, said the people, who asked not to be identified because the details aren’t public. Shanghai Industrial Development, the state-owned developer that owns the tower, expects that the site could be valued at as much as 9 billion yuan ($1.3 billion), one of the people said.
The office would mark the insurer’s commitment to expanding in China despite economic headwinds from stringent Covid restrictions. AIA became the first wholly owned foreign life insurer in the country after turning its Shanghai branch into a subsidiary in 2020, paving the way for growth.
Source: Bloomberg
SoftBank has raised as much as $22 billion in cash from deals that would sharply reduce its stake in Alibaba over the coming years, as the Japanese investor responds to a market downturn that has ravaged its technology portfolio.
The group, led by billionaire founder Masayoshi Son, has this year carried out the sale of about one-third of its Alibaba stake through prepaid forward contracts — a type of derivative to which SoftBank has increasingly turned to raise cash immediately while retaining the possibility of holding on to the shares.
SoftBank has now sold more than half its Alibaba holdings through these forward sales. That could shrink its stake in the Chinese e-commerce giant below the threshold for retaining its board seat and prevent the Japanese group from recognising its share of Alibaba’s income in its financial statements.
If SoftBank opts against buying back the Alibaba shares, it would mark the end of an era. Son built his fortune on the back of leading a $20 million funding round for Jack Ma’s fledgling e-commerce start-up more than two decades ago, generating a huge return on investment.
Source: Financial Times
HONG KONG
HSBC chair Mark Tucker has issued a rebuke to the bank’s largest shareholder Ping An, rejecting calls to split its Asian and western operations and stating that “the best structure is our existing structure”.
In an occasionally tense meeting in Hong Kong’s Kowloon international trade centre on Tuesday, Tucker warned about 1,000 of HSBC’s retail shareholders that a break-up of its business would result in large costs over five years, a fall in the bank’s share price and reduced dividends.
It would be a “hugely complex exercise and our belief has been that the best strategy is to continue with positive momentum we currently have and not risk a major structural change”.
Source: Financial Times
Hong Kong-based billionaire Calvin Lo is considering putting more money into Formula One following his connection with F1 team Williams, Lo told Reuters in an interview, adding other Asian investors were also interested in investing in the sport.
Lo, chief executive of insurance broker RE Lee International, confirmed he has "some sort of exposure" to Williams, following the U.S.-based private investment firm Dorilton Capital's purchase of the team in 2020. He declined to give more detail, citing non-disclosure agreements.
Source: Reuters
Hong Kong’s asset management industry group is calling on the government to open up investments in the city’s Mandatory Provident Fund (MPF) to pension plans from China, and to bolster cross-border investment schemes with the Mainland to help the industry regain competitiveness.
The Hong Kong Investment Funds Association (HKIFA) is hoping that the government will consider the proposals for inclusion into its annual policy paper, which will be delivered on October 19.
The group says in a statement on August 1 that the recommendations will “enable the fund industry to regain its competitiveness and propel it to the next level”.
Source: Asia Asset Management
Hundreds of financial professionals in Hong Kong moved to Singapore last year, according to recruitment firm Robert Walters, in another sign of talent outflow from the city.
The shift in talent flow from Hong Kong to Singapore was a major driver for growth in the latter’s financial sector with more than 718 professionals moving to the city-state in 2021, according to a report by recruitment firm Robert Walters. In addition, the establishment of fintech start-ups in Singapore was also a major growth driver.
Source: finews
JAPAN
Japan's Government Pension Investment Fund (GPIF) reported on Friday an investment loss of ¥3.75 trillion ($28.13 billion) for April-June, the second consecutive quarter of negative returns, as economic slowdown fears hit global stock markets.
The world's largest pension fund lost 1.91% for the three months, trimming its overall assets to 193.126 trillion yen, it said in a statement. The loss widened from 1.1% in the previous quarter, which represented the fund's first quarterly loss in two years.
Source: GPIF
Also read: Overseas bonds prop up GPIF's negative Q1 returns
KOREA
The National Pension Service (NPS) has issued a request for proposal for domestic venture capital fund managers.
NPS plans to commit a total of W150 billion ($115 million) to up to four venture capital fund managers. Eligible managers should manage a fund of at least W50 billion.
The submission deadline is September 1 2022, with the final decision set to be made in November.
Source: NPS
The Korea Teachers' Pension has issued a request for proposal for domestic private equity fund managers.
The pension fund plans to invest up to W400 billion ($306 million) with up to four private equity fund managers, with a maximum of W100 billion per company. Eligible managers should manage at least a total of W500 billion.
The submission deadline is August 23, with individual selection of final selection in September.
Source: Korea Teachers’ Pension
MALAYSIA
Malaysia’s Retirement Fund Inc (Kwap) plans to rebalance its investment portfolio towards private markets and fixed income in a bid to grow its fund size to RM200 billion ($45 billion) by 2025. The fund is currently at RM159 billion as at end-2021.
Chief executive officer Nik Amlizan Mohamed said that the fund will focus on three asset classes in the private market space: private equity, infrastructure and property.
“Returns from the public markets have not been on the high trajectory in terms of growth compared to the private markets. We are seeing double-digit growth returns in the private market space,” she said.
Kwap had earlier announced plans to further grow its gross fund size to RM200 billion ($45 billion). The fund is currently at RM159 billion as at end-2021.
Kwap plans to grow the fund using ‘Teras 5 initiatives’, it said in a statement, referring to a three-year programme that uses five enablers (structure, governance, people, processes and digital), as well as eight workstreams, which include organisational structure, investment, retirement services and corporate services.
PHLIPPINES
The Gokongwei family and two major partners have invested P2 billion ($36 million) to form Maxicare Life Insurance Corp, a new entrant to the Philippines’ life insurer industry, the Insurance Commission (IC) said on July 29.
MaxiLife’s three major incorporators are privately held investment firm JE Holdings, whose president and chair is tycoon Lance Gokongwei, Pin-An Holdings, Maxicare Health Corp. of the Equicom Group.
With an authorised capital stock of P2 billion, MaxiLife is the first domestic insurer established as a ‘new domestic life insurance company’ under Section 194 of the Insurance Code of the Philippines.
MaxiLife will associate with both the network and brand of Maxicare, specifically initially offering extended employee benefits for the latter’s corporate clients.
Source: Philippine Daily Inquirer
SINGAPORE
Singapore’s sovereign wealth fund GIC and alternative investment firm Carlyle announced a “strategic investment” in green ammonia project development company Eneus Energy Limited.
“The investment in Eneus reflects GIC’s continued deep commitment to renewable energy innovation and global decarbonisation efforts,” Ang Eng Seng, chief investment officer of Infrastructure at GIC, said. “This is a strategic investment to position GIC early for the green hydrogen market which we believe will play a crucial role in the transition to clean energy.”
GIC did not disclose the amount invested but Bloomberg reported that the deal gives Carlyle and GIC the ability to invest more than $3 billion in Eneus Energy’s projects in the next five years.
INTERNATIONAL
Florida Governor Ron DeSantis has proposed a law for the 2023 legislative session to “protect Floridians from the environmental, social, and corporate governance (ESG) movement” which he claims advances a woke ideaological agenda and is a threat to the American economy, according to his government website.
DeSantis’ proposal would amend Florida’s Deceptive and Unfair Trade Practices statute and would prohibit fund managers for the State Board of Administration (SBA) from implementing ESG analysis in their management of the state’s pension fund portfolios.
If the law is passed the Florida SBA — which manages around $250 billion in total assets for the Florida Retirement System and about 25 other funds — would be required by law to only consider “maximising the return on investment on behalf of Florida’s retirees.”
DeSantis’ proposal would also prohibit large banks, credit card companies and money transmitters from not investing in certain public companies based on their ESG ratings.
Source: Florida Governor’s Homepage
A federal judge in the US District Court of Northern California agreed to consolidate a series of lawsuits against Facebook and has appointed the Ohio Public Employees Retirement System (Opers) and PFA Pension of Denmark to jointly serve as the lead plaintiff in the securities class-action case against social-media company.
Ohio’s attorney general David Yost will represent Opers and any other affected investors in their effort to recover millions of dollars in losses and to compel reforms in the Facebook’s internal practices.
Opers and PFA which filed their motion to serve as lead plaintiff jointly were appointed “by virtue of having the largest financial interest” according to the judge’s ruling, last Thursday.
The California Public Employees Retirement System had also petitioned to serve as lead plaintiff but was unsuccessful.
In its lawsuit, Opers maintains that Facebook — which has rebranded to Meta since the complaint was first filed — misled the public about how its proprietary algorithm promoted offensive and dangerous content to users. The complaint contends that those misrepresentations boosted the price of Facebook stock and harmed investors and caused $3 million in losses to Opers.
Source: The Ironton Tribune ; PFA