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Reuters – An increasing number of sovereign wealth funds are working in concert to make joint strategic investments in order to reduce risks and maximize returns, which could provide a stabilizing force in financial markets.
State-owned funds from China, Singapore, Malaysia, Korea, Abu Dhabi and Kuwait are among those which have recently signed agreements to form investment partnerships with each other.
These partnerships will enable state-owned funds to optimize local knowledge, leverage capital, spread investment risks and maximize returns.
Globe and Mail – Paris, so far, has emerged as the most serious challenger. But Mr. Sarkozy may be his own worst enemy on this file. The reason: He and his German allies are wholesale supporters of the European Union effort to rein in the hedge funds even though the funds can take little blame for the financial disaster.
If Mr. Sarkozy gets his way, the funds, which are a huge business in London, won’t jump on the Eurostar and re-emerge in Paris. They will leave the EU entirely for Switzerland (not an EU member; some funds have already moved there) or any of the financially ambitious Middle East and Asian cities – Abu Dhabi, Singapore, Shanghai – which are dangling gold and pearls before the big-name fund managers.
Globe and Mail – The hedge fund crowd jumped on Nova Chemicals yesterday, thrilled to invest in a takeover, but pessimistic that a bidding war will begin for the chemical company.
Despite heavy trading yesterday, the price of shares in Nova never came close to the $6 (U.S.) a share cash offer from Abu Dhabi state-owned oil company International Petroleum Investment Co. (IPIC).
