Insto roundup: Indonesia aims for $200b AUM for SWF; Mitsui Sumitomo launches $4.6b M&A fund
AUSTRALIA
The A$1 billion ($760 million) AUSfund has announced that it will shut down and transfer eligible members to Hostplus.
AUSfund, Australia’s oldest eligible rollover fund (ERF), which manages lost or inactive superannuation balances, will wind up the fund and transfer members with accounts holding more than AU$6,000 to Hostplus in late May.
The decision came after new government legislation required ERFs to transfer all accounts to the Australian Taxation Office by June 2022.
Source: Hostplus
Michelle Boucher has left Cbus to join the A$3 billion ($2.29 billion) First Super as deputy chief executive.
In her new role, which was effective last week, she will be responsible for business development, marketing and communications functions. She will continue to be based in Melbourne.
Boucher was previously group executive of people, technology and enablement at the A$46.7 billion Cbus, where she worked for close to eight years. She has also previously held executive positions at ESSSuper.
Source: Financial Standard
The Australian Prudential Regulation Authority (APRA) has proposed imposing an aggregate limit on the exposure of life insurers to offshore reinsurers that are not regulated by APRA.
The proposed updates have been released for stakeholder feedback in response to concern over the rise of life insurers “placing business with offshore reinsurers,”, APRA said in a statement.
“These concerns are particularly heightened in relation to the group risk market, which plays an important role in Australia’s superannuation system,” it wrote.
Source: APRA
INDONESIA
President Joko Widodo has set a $200 billion goal for Indonesia's new wealth fund in the next two to three years, aiming to fund his push for the resource-driven economy to rise up the value chain. That's double the $100 billion target set earlier this year, and a long way from the fund's US$15 billion start.
The fund has been in talks with 50 fund managers and has received pledges from those in the United Arab Emirates, Japan, the US and Canada, which will help it grow to $20 billion in six months, the president said on April 7.
"We can reach this," Widodo said from the palace in Jakarta. "We give investors the freedom to choose whether to invest in the entire portfolio or to choose the thematic funds. This is what I think is unique."
Source: Business Times
JAPAN
Mitsui Sumitomo Insurance plans to invest up to ¥500 billion ($4.55 billion) on foreign mergers and acquisitions through 2023 by creating a fund with a focus on North America, said Shinichiro Funabiki, the company’s newly minted chief executive. The company will use its surplus cash as capital for the fund, which will allocate around 60% to North America.
Funabiki said the insurer “hopes to diversify its portfolio as it faces a difficult earnings environment in Japan. Now that we have made it into the global top 10 by revenue, we need to reach the top level in terms of profits. We will create a ¥500 billion fund for overseas M&A”.
Funabiki succeeded Noriyuki Hara as president and chief executive on April 1. The insurer had around ¥6.69 trillion of total assets as of March 2020.
Source: Nikkei, Asia Asset Management
MALAYSIA
Permodalan Nasional Bhd (PNB) intends to keep diversifying its portfolio by geography and asset class, and invest more in renewable energy (RE), infrastructure and 5G adoption.
PNB president and group CEO Ahmad Zulqarnain Onn said the fund’s diversification efforts, and particularly its growing international exposure, saw its net income for the 2020 financial year to grow by 2.8% to RM11 billion, while its international assets rose by 3.5% to account for 12% of its overall portfolio.
“PNB aims to gradually expand this segment of new investments over the long-term including in RE, 5G technology, logistics and data centres, which are among the defensive sectors that provide stable-recurring yields,” Ahmad Zulqarnain said, adding that PNB aims to gain exposure in these sectors by participating in IPO activities globally.
Source: The Malaysian Reserve
VCCs are Singapore-registered entities that are specifically designed to invest into private assets. The AIA VCC is being managed by AIA Investment Management Private, which had reported assets under management of SGD178 billion as at the end of 2020.
AIA said it "is now exploring how the recently introduced VCC framework can support AIA’s investment programme with particular focus on balance sheet exposure to specialist and alternative investment strategies".
Source: AIA press release
Temasek-backed Grab is expected to list on Nasdaq through a merger with Altimeter Capital Management’s $450 million special purpose acquisition company (Spac). The deal values the ride-hailing super-app at $35 billion and could be the world’s largest Spac deal to date.
Grab is expected to raise around $2.5 billion through a private investment in public equity (Pipe) – a type of transaction that often accompanies a Spac deal.
Temasek’s $10 million investment in Grab in 2017 (then known as Grabtaxi) through its venture capital arm Vertex Ventures, prompted the ride-hailing company to move its headquarters from Malaysia to Singapore.
Source: Financial Times
INTERNATIONAL (EX-ASIA)
Sovereign wealth fund Abu Dhabi Investment Authority and the real estate arm of Caisse de dépôt et placement du Québec, Ivanhoe Cambridge, are amongst 14 anchor investors in Mumbai-based real estate developer Macrotech.
Macrotech raised a total of ₹7.4 billion (499 million) ahead of its initial public offering which opened on April 7 and concluded on April 9. Brookfield Asset Management and Nomura are also among the anchor investors.
This is Macrotech’s third time attempting an IPO after aborting plans in 2009 and 2018 citing market conditions.
Source: DealStreetAsia
The Norwegian government proposed omitting the smallest companies from the NOK11 trillion ($1.29 trillion) Government Pension Fund Global’s (GPFG) equity benchmark, a change that could cut the number of individual stocks it invests in by between 25 and 30%.
Publishing its 2021 white paper on the country’s overall sovereign wealth fund, finance minister Jan Tore Sanner said the reference benchmark would be slimmed down in order to reduce costs as well avoid some of the complications of ownership.
Other key plans for the Norwegian SWF includes a decision not to add any new countries to the fund’s emerging markets universe.
Source: IPE
Dutch pension fund PGGM has committed A$350 million ($269.5 million) to a real estate fund by Australia’s EG Funds Management.
Following this investment, the EG Australian Core Enhanced Fund will shift its focus to industrial, office and non-discretionary retail assets. It previously targeted light industrial and logistic assets in Sydney and Brisbane, and counter cyclical investments in office assets in Perth.
The addition from PGGM brings the Australian fund’s assets under management to AU$1.25 billion.
Source: EG Funds Management