Insto roundup: China’s new tech board; Korea’s record overseas buying
AUSTRALIA
MapR, a tech-focused venture capital investment made by Australia's A$154 billion ($106 billion) Future Fund, could find itself in a downward spiral as open-source big data companies struggle to stay afloat, with two of its major rivals having recently merged.
“We don’t comment on individual investments, but it is inevitable that some investments don’t work as hoped,” said the Future Fund. “However, our venture and private equity programme, and the Future Fund portfolio as a whole, have performed strongly and continue to do so,” it added.
After receiving A$77 million ($53 million) of equity raising from the Future Fund, MapR has seen its chief executive replaced and the release of its poor first-quarter results amid the emerging trend of a new generation of cloud-based platforms, such as Amazon Web Services.
Source: The Sydney Morning Herald
The Australian Prudential Regulation Authority (Apra) has issued directions and license conditions on AMP Super to “make significant changes to its business practices”, according to Apra’s statement.
The directions apply to AMP Superannuation Limited and N.M. Superannuation Proprietary, which are known as AMP Super. AMP Super will be required to renew and strengthen its board and employ external help to report on remediation and compliance.
Source: Nasdaq
Berkshire Hathaway Specialty Insurance announced on June 12 that it would be expanding its business in Australia to Adelaide, South Australia. Monica Holland has been named underwriting manager and casualty manager for South Australia.
Holland will be working closely with the insurer’s Melbourne team to deliver a full range of products the firm offers, including property, liability and health insurance solutions.
Source: Insurance Business
CHINA
The science and technology innovation board was officially launched by the China Securities Regulatory Commission (CSRC) on June 13. It is meant to encourage investment in domestic tech innovators, enabling them more resources to develop and also have an incentive to list at home.
The board sets a higher bar for participants as only institutional investors or retail investors with rich experience and certain asset under management are allowed to participate, Michelle Qi, chief investment officer for equities in China at Eastspring Investments, said in a note to clients.
“For equity investors, it is a larger investable universe. This will attract more global investors to flow into the onshore market to get exposure to Chinese new economy names, and provide more investment options for onshore institutional investors such as the pension funds and other asset managers, so that they can diversify their investments with a better risk-return profile,” Qi said.
Sources: South China Morning Post, Eastspring Investments
INDIA
Investors including Beijing-based Asian Infrastructure Investment Bank, Germany’s Deutsche Investitions- und Entwicklungsgesellschaft (DEG), IFC and India’s HEG have bought a 4.2% stake in an infrastructure investment trust formed by Indian infrastructure firm Oriental Structural Engineering.
The Oriental Infra Trust’s INR23 billion (US$329.29 million) offering was oversubscribed and attracted strong interest from global investors. An infrastructure investment trust, recently introduced in India allows the pooling of infrastructure assets with dividend payouts.
Source: The Economic Times
KOREA
South Korea’s National Pension Service (NPS) has reportedly decided to introduce a new hiring policy for its portfolio managers. According to the new policy, one of the largest pension funds in the world now wants to hire fresh talent and nurture them instead of hiring experienced managers as it currently does.
To date, the NPS has hired only experienced professionals for portfolio manager positions. Since the pension manages massive assets about W675 trillion ($571 billion), the emphasis on experience makes sense.
The pension’s staffing policy shift comes amid continuous exodus of its staff members, especially portfolio managers. The NPS has been grappling with staff turnover since it decided to move its office in February from Seoul to Jeonju, which is about three hours away from Seoul by high-speed rail.
Source: Chosun Biz (In Korean)
South Korea's overseas direct investment hit a record level in the first quarter due mainly to a high base effect, government data showed Friday.
Investments made by South Korean companies came to $14.11 billion in the January-March period, up 44.9% from $9.74 billion in the same period last year, according to the data compiled by the Ministry of Economy and Finance. The figure is the highest for any first quarter since 1981, when the government began to release data on investments made by local companies.
The US accounted for the largest share of South Korea's overseas investments, with $3.65 billion in the January-March period, up 95.2% from a year earlier. South Korea's direct investment in China -- South Korea's largest trading partner -- jumped 156.1% to $1.69 billion, and its direct investment in Singapore increased 315.4% to $1.08 billion.
Source: Yonhap News Agency
Korea Investment Corporation (KIC) has confirmed the hire of Park Dae-yang as chief investment officer (CIO), as AsianInvestor described last week, and has also unveiled Yoo Changho as chief risk officer, effective June 3.
Park, currently CIO of Korea Teachers' Pension Fund, will succeed the former KIC CIO Kang Shin-woo whose three-year term ended June 12, following qualification and reference reviews. His three-year term will begin in mid-July upon the KIC steering committee's final go-ahead.
Park has an MBA from Iowa State University and was among four candidates shortlisted out of around 20 applicants who entered bid for the position since April. Among the shortlisted were former CIOs: Lee Chang-hoon of the Government Employees Pension Service, Tong Yang Asset Management's Koo Se-hoon and another candidate from Samsung Asset Management.
Source: Korea Times, Sovereign Wealth Institute
Korea's Military Mutual Aid Association (MMAA) has invested W40 billion ($34 million) to buy a minority stake in Welcome Break, the UK’s second biggest motorway service station operator, further diversifying its infrastructure-type asset portfolio for stable returns.
MMAA’s board approved the investment last week to buy a stake of around 3% in the UK service station chain from Korea Investment& Securities.
Korea Investment & Securities has been selling down its 5.6% stake in Welcome Break since it acquired the equity interest for W68 billion last year from South Korean private equity firm Aarden Partners.It was Korea Investment’s first equity investment in a foreign company sourced by a domestic private equity house.
Source: Korean Investors
MALAYSIA
The former head of Malaysia’s civil service pension fund, Kwap, has said that former prime minister Najib Razak had ‘influenced’ her decision to lend RM4 billion to a firm linked to 1Malaysia Development (1MDB).
Najib was her “ultimate boss” when the loan was given out in 2011 and 2012, the former former chief executive reportedly said.
Source: New Straits Times
Insurance premiums in Malaysia are expected to grow to more than 6% on an annualised basis, according to Allianz Research. Premiums per capita in Malaysia are higher than China and Thailand with insurance penetration, or premiums as a percentage of gross domestic product, at 4.3% versus 3.7% in China, the research house said.
Last year, insurance premiums in Malaysia grew 4.6%, slightly surpassing 2017’s growth of 4.2%. Life insurance accounted for more than 70% of the premium pool with a growth rate of 6%, which grew faster than property-casualty.
Source: The Star
MIDDLE EAST
Sovereign wealth fund Qatar Investment Authority (QIA) is close to pumping in $200 million to $250 million for a stake of around 5% in Indian education technology unicorn Byju’s.
According to a Business Standard report on Monday, flagged by Deal Street Asia, the two parties have signed the term sheet on the deal, which will mark QIA’s first investment in an Indian startup.
It was not clear in the report if any of the existing investors would exit in the process. The development comes at a time when Byju’s is looking to bolster its international expansion.
Source: Deal Street Asia
NEW ZEALAND
Fidelity Life in New Zealand has appointed Katherine Johnson as chief operating officer, effective August this year.
Johnson reports to chief executive Nadine Tereora and will look after Fidelity Life’s underwriting, new business, customer services and claim teams. She will be succeeding Neale Watling, who is retiring after being with the firm for 17 years.
She joined from claims service provider Gallagher Bassett as executive general manager of claims.
Source: Insurance Business
PHILIPPINES
The Philippines Social Security System has disbursed PHP1 billion ($19.20 million) in pension loans as of May 27, the state-run social insurer said.
The programme, launched in September of last year, allowed senior citizens access to cheap loans without tapping into informal lenders, a persistent problem in the Philippines. A total of 41,926 pension-borrowers borrowed under the program since inception with 92.2% preferring to pay in one year and 6.3% in six months, SSS data showed. The rest chose to pay in three months.
Source: The Manila Times
SINGAPORE
Singapore’s sovereign wealth fund GIC has made a tidy profit on its investment in China’s Hansoh Pharmaceutical Group. Shares in the drug maker ended up 37.3% on their Friday debut in Hong Kong.
GIC has made the biggest commitment the nine cornerstone investors, pledging $70 million in funds.
GIC and onine travel company Booking Holdings have gotten into bed with South Korean hotel room aggregator Yanolja. The platform that helped institutionalise the popular Korean concept of pay-by-the-hour “love hotels” raised $180 million from the two investors, its chief executive said.
That brings Yanolja’s valuation to more than $1 billion with an initial public offering expected as early as next year, CEO Kim Jong-yoon said in an earlier interview.
Source: Reuters
Singaporean state investor Temasek Holdings and Schneider Electric SE gained approval from India’s antitrust regulator for the acquisition of Indian engineering conglomerate Larsen & Toubro’s electrical and automation business.
The Competition Commission of India said the French company’s local arm making the acquisition will need to keep aside part of the L&T unit’s capacity for outside manufacturers for five years. It also cannot discontinue any products and raise prices for five years, the CCI said in a statement.
Source: VCcircle.com
INTERNATIONAL
An annual survey by the Official Monetary and Financial Institutions Forum of 750 institutions from 183 countries with assets valued at $37.8 trillion found that 43% had sought to raise their risk budget and move into higher-yielding assets, while 37% had simply accepted a lower return.
Some big investors, such as the Swiss National Bank and Japan’s Government Pension Investment Fund, reported a drop in assets for the first time since Omfif began its survey in 2014.
Overall, growth in assets held by public-sector institutions slowed to $1.4 trillion or 3.7% in 2018, down from 7.6% in 2017, as weak equity markets, which experienced one of the worst years since the 2008 financial crisis, took their toll.
Source: EuroNews
Canada Pension Plan Investment Board (CPPIB) is buying an 8% stake in Indian logistics company Delhivery for $150 million, underscoring the rising interest of investors in growth-stage technology firms.
The C$392 billion ($292.3 billion) public retirement fund is buying the shares from Indian private equity firm Multiples Alternate Asset Management, said two people familiar with the deal. Venture capital firm Nexus Venture Partners, an early investor in Delhivery, may also liquidate some of its shareholding.
CPPIB’s secondary stake sale would value Delhivery at $1.5 billion, said a person close to the matter. Other investors in the logistics company include Softbank Vision Fund, private equity firm Carlyle Group and Chinese conglomerate Fosun.
Source: Economic Times