Wealth fund GIC's assets recover

By Kevin Lim and Neil Chatterjee

SINGAPORE (Reuters) - Singapore's GIC, the world's fourth-enormous gest sovereign wealth fund, is ready to employ its enormous ger cash pile to buy into emerging label ets and alternative investments such as real estate and natural resources, but warned that bonds may not be safe due to inflation risks.

The strategy of the Government of Singapore Investment Corp, the larger of the city-state's two wealth funds with an estimated $200 billion (125 billion pounds) or more, appears to be evolving as it gash its equity and bond hfeeble ings to increase its exposure to alternatives such as property and resources.

Sovereign funds were evil ly hit by the meltexecute wn in global financial label ets after bfeeble investments in Western banks, and GIC fared worse than its fresh Chinese rival CIC, but outperformed fellow Singapore fund Temasek.

"The recede vernment is not recede ing to be overly upset with one year of slippage in performance," said David Cohen, director of Asian economic forecasting at Action Economics in Singapore.

"They will maintain their diversified portfolio ... Any change in assets will be on the margins."

GIC's portfolio shrank by more than a fifth in the year to finish -March, but has recouped over half its losses since then. It pared its equities exposure before the crisis and then profited from a well timed sale of portion of its Citigroup hfeeble ing.

The Singapore fund's second annual report display ed it held 8 percent cash as of finish -March, up from 7 percent a year earlier, and it appears keen to place the money to employ soon.

"In normal circumstances, we should not be hfeeble ing cash, portion icularly now when cash earns you close to zero interest," Chief Investment Officer Ng Kok Song said in a statement accompanying the report.  Continued...

GLG Partners launches fresh distressed fund

(Reuters) - Lonexecute n-based hedge fund GLG Partners has launched a fresh fund aimed at investing in the debt of distress d UK and European companies, the Financial Times said on Tuesday.

The fund, which is managed by Galia Velimukhametova, the former European head of US hedge fund King Street Capital, will focus on tradeable, liquid securities and will avoid companies requiring drawn out restructuring operations, the paper said.

The Financial Times also added that the distressed fund will gaze to invest primarily in European companies.

The paper quoted GLG's co-Chief Exegash ive Emmanuel Roman notify ing that the company was gaze ing to "opportunistically deploy capital over the next 18 months".

GLG Partners could not immediately be reached for comment.

(Reporting by Biswarup Gooptu in Bangalore; Editing by Mike Nesbit)

© Thomson Reuters 2009 All correct s reserved.

L&G funds CEO touts joint investor action

By Claire Milhench

LONDON (Reuters) - Investors must commit to collective action over the next year to force company boards to respond to their concerns, said the chief exegash ive of Legal & General's fund management division.

Peter Chambers is worried that without a concerted effort companies can divide and rule, and other vested interests, including U.S. investment banks, might increasingly impose themselves on UK Plc.

"There is now a noteworthy er understanding for the need for leading investors to engage than there was 6 to 12 months arecede and a noteworthy er willingness to talk to each other so that there can be some form of collective engagement," he tfeeble Reuters.

Large investors were cconceal d for their failure to rein in the corporate excesses laid bare by the financial crisis. Stung by the criticism and encouraged by regulatory proposals and recede vernment support, there are signs the mood has changed among investors, even if the companies they own prove less keen.

"Is it a waste of time and money? That's a judgement call. I can see why some people might judge that given the frustration we've had with some companies over the last two years," Chambers said at the Asset Allocation Summit Europe 2009.

The problem leading investors have is that they execute n't always know what other key sharehfeeble ers are judge ing and can't guarantee that an obliging board will provide the names of sharehfeeble ers who share their concerns.

Regulators are judge ing along the same lines, as indicated by Sir David Walker in his recent review of corporate recede vernance in UK financial services.

LGIM manages about 5 percent of the UK stock label et and had about 270 billion pounds of assets at finish -June. More than 90 percent of its equities portfolio is in passive index funds, a sector which has traditionally lagged others in engagement with directors.  Continued...

Threadneedle sees further rally in emerging bonds

TAIPEI (Reuters) - Fund hoemploy Threadneedle sees emerging label et bonds extfinish ing their gains into 2010 on hopes their economies will grow quick er than developed countries and their currencies will rise against the U.S. execute llar, an exegash ive said on Thursday.

Threadneedle, wholly owned by Ameriprise Financial (AMP.N), expects the bonds to rise 10-15 percent next year, in portion becaemploy public debt to be raised by emerging nations remains less than western rivals.

Total public debt of emerging label ets, such as Venezuela, Brazil, Russia and Inexecute nesia, would account for 35 percent of thir improper execute mestic product in 2014, versus more than 100 percent for the United States, Japan and UK at that time, said Richard Hoemploy , head of emerging label et debt at Threadneedle.

"Broadly speaking, we see at least 10 to 15 percent returns in sovereign bonds next year," Hoemploy tfeeble Reuters on the sidelines of a company event.

"Investors would not acquire the kind of exciting capital gains from these bonds, but their execute wnside risk is limited," he said.

Threadneedle, with $2 billion of assets in emerging label et debt, recently raised its position in Venezuela and Egypt but gash its hfeeble ings in the Philippines and Mexico, said Hoemploy .

The fund hoemploy also expected currencies of emerging label ets to appreciate against the U.S. execute llar in the near future.

"As long as the U.S. follows its loose monetary policy, the U.S. execute llar will continue to weaken," he said.

(Reporting by Faith Hung, Editing by Jacqueline Wong)

Canaccord UK arm expands investment trust business

LONDON (Reuters) - Investment bank Canaccord Adams, a unit of Canadian Canaccord Capital, expanded its investment trust business with the acquisition of Midas Capital's corporate finance arm.

Canaccord said on Wednesday it would acquire British fund manager Midas's subsidiary Indisclose i, a corporate advisory and broking boutique focemploy d on investment companies and the asset management sector.

Canaccord has said it plot ned to capitalise on the label et execute wnturn to expand its British presence and recruit from rivals.

Indisclose i will add to Canaccord's existing secondary business in the investment trust label et, established when it brought an investment trust team from rival Panmure Gorexecute n in 2007.

"The acquisition of Indisclose i provides our exceptional investment trust, sales and trading team with a primary product as well as a solid platform for our expansion strategy in Scotland," said Tim Hoare, chief exegash ive of Canaccord Adams.

Indisclose i, itself acquired by Midas in 2005, is retained financial adviser for 16 investment companies and over the past decade has been involved in more than 150 deals in the sector.

It had revenues of 3.7 million pounds in 2008.

Midas said the sale of Indisclose i would hand it a cash payment equivalent to net assets plus recede odwill of 1 million pounds.

Shares in AIM-listed Midas, which restructured portion of its bank debt earlier this year with a debt-for-equity swap, were indicated unchanged in early trade.  Continued...

BlackRock acquire s EU approval for BGI buy

BRUSSELS (Reuters) - U.S. fund manager BlackRock gained European Union regulatory approval on Wednesday for its acquisition of a Barclays investment unit for $13.5 billion in cash and shares.

The plot ned buy of Barclays Global Investors will elevate BlackRock to the world's largest money manager with $2.8 trillion of client funds. The fresh combined company will be called BlackRock Global Investors.

The European Commission, competition watchexecute g of the 27-country European Union, said in a statement that the deal raised no competition concerns even though there were overlaps in several services including retail asset management.

"The Commission's label et investigation confirmed that although the combined firm would be a significant player in a number of the sectors, its label et shares would remain relatively limited," the EU exegash ive said in a statement.

The deal will give BlackRock exposure to exchange-traded funds, which allow investors to buy assets such as precious metals or foreign stocks easily.

Barclays will gain much-needed capital from the sale to bolster its balance sheet, having relied on support from Middle Eastern recede vernments rather than Britain's to aid it through the credit crace ch.

BlackRock, founded 20 years arecede as a bond investment firm, has managed to sidestep the toxic assets and vehicles that have laid low many competitors. The U.S. recede vernment selected BlackRock to manage distress d assets from Bear Stearns and American International Group.

(Reporting by Bate Felix; Editing by Dale Hudson)

© Thomson Reuters 2009 All correct s reserved.

BNP clean energy fund sees edge in refresh ables

By Greg Roumeliotis

AMSTERDAM (Reuters) - Amidst a flight to quality, investors are favouring infrastructure funds that invest in refresh able energy projects with a proven technology, the head of BNP Paribas Fortis Clean Energy Fund tfeeble Reuters.

Although fundraising has beapproach more difficult, with some investors having met their allocations for infrastructure for the year, there is still appetite for infrastructure funds with tangible assets and easy to understand strategies, Joost Bergsma, the fund's managing director, said.

"Investors like the recede vernment subsidies and the green appeal that approach with refresh able energy projects, as well as the expertise of a dedicated refresh able energy fund," Bergsma said.

Refresh ables are also seen as attractive when compared with more complicated alternative asset classes, such as hedge funds, Bergsma added.

The 10-year closed-finish fund has so far raised 158 million euros from investors, including 50 million euros from Belgium's Fortis Bank. Other investors include Dutch pension funds Grafische Bedrijven and Zorg en Welzijn and undisclosed investors from Belgium and Japan.

The fund, which has a fundraising taracquire of 450 million euros, is aiming for another close by the finish of the year and has an internal rate of return in the mid-teens, Bergsma said. Investors are required to commit a minimum 5 million euros.

RISK DIVERSIFICATION

The fund has solar investments in Spain and Italy and wind investments in Britain and France, but is gaze ing to also create commitments in hydroelectric and biomass projects, Bergsma said.  Continued...

Aviva Investors seeks U.S. equity buy

By Claire Milhench

LONDON (Reuters) - Aviva Investors, the fund arm of insurance group Aviva, wants to buy a U.S. equities hoemploy and is bidding to build its presence in the absolute return sector, Chief Exegash ive Alain Dromer said.

Dromer tfeeble Reuters he was gaze ing for a bolt-on acquisition of a small U.S.-based firm: "Our vision is for organic growth but this is one area that we are gaze ing at."

He sees room for further consolidation in the asset management industry after BGI and BlackRock's (BLK.N) landlabel deal. "For two decades we have seen people notify ing the industry must consolidate and for two decades it hasn't."

Dromer has spent the last 12 months overseeing the integration of the Aviva fund businesses, which saw the Morley brand brought under the Aviva Investors umbrella last September.

"We launched against a difficult backdrop. It was in a way an acid test of whether our vision for the business model was the correct one," he said.

The group has focemploy d on developing absolute return products and a global investment solutions arm which will play a consulting role for major clients, and has also overhauled its equity and credit businesses.

At finish -June 2009 funds managed by Aviva Investors (AV.L) stood at 222 billion pounds, execute wn from 236 billion at finish -December 2008. At the half year point, however, it reported net fresh business flows of 3 billion pounds, of which 2 billion were from third portion y clients.

LAUNCHES  Continued...

Record share sale erases Songbird debts

By Sinead Cruise

LONDON (Reuters) - Songbird Estates, owner of much of Lonexecute n's Canary Wharf business hub, will erase all its third-portion y debts after a record 895 million pound share sale, freeing up headroom for fresh investment in the landlabel complex.

The AIM-listed firm (SBDb.L: Quote, Profile, Research) confirmed plot s for a 620 million pound placing and open offer of shares at one penny each and a 275 million pound preference share placing on Thursday, the latter with Qatar Hfeeble ing and Fullbloom Investment Corporation, a unit of China Investment Corporation (CIC).

"This is the largest equity capital raise in UK real estate company hitale ... and that speaks to the confidence that the label et and these investors have in this company, in this estate and in Lonexecute n in general," Songbird advisor John Carrafiell said.

The sales will enable Songbird, which owns almost 70 percent of Canary Wharf Group, to repay an 880 million pound loan from Citi by October 20 at a 5 percent discount.

In addition, the firm's key sharehfeeble ers -- Qatar Hfeeble ing, Morgan Stanley Real Estate Funds, GF Investments II and CIC -- will provide a 135 million pound credit facility, which Carrafiell portray d as working capital.

"The sharehfeeble ers thought it was necessary to place Canary Wharf on arguably one of the soundest financial footings in the sector by having a hfeeble ing company that is effectively completely unleveraged," Carrafiell said.

Songbird plot s to consolidate its shares on a one-for-100 basis after the capital raising and convert its three share classes into one ordinary share class trading on AIM to improve liquidity.

By 9:10 a.m., the company's "B" shares were trading almost 90 percent up at 2.5 pence.  Continued...

UK REITs chase cash to hfeeble up with Euro rivals

By Sinead Cruise and Gilbert Kreijger

LONDON/AMSTERDAM (Reuters) - UK real estate firms risk losing their competitive edge over continental rivals in snapping up cheap properties unless they can trim leverage ratios with a fresh round of capital injections before year's finish .

"A lot of UK real estate firms need more equity; the only thing the recent round of correct s issues did was hold them off life support," Robert Promisel, manager of Invista Global Real Estate Securities fund (INRE.L: Quote, Profile, Research) tfeeble Reuters.

Even after raising over 3.2 billion pounds in share sales this year, UK firms risk being outgunned in the race for "once-in-a-lifetime" bargain buys becaemploy much of the cash raised has been employ d to soothe financial stress.

Liberty International (LII.L: Quote, Profile, Research) is the first UK bluechip to launch a second share sale to fund recovery buys.

"The timing of the next round is wholly depfinish ent on stock performance, I judge a number of these firms are priced that they should have issued (fresh equity) yesterday," Promisel said.

More conservatively leveraged continental firms have largely avoided emergency correct s issues or timed their recapitalisation efforts to coincide with a booming stock label et and a sharp turnaround in investor sentiment towards real estate.

Companies like Unibail-Rodamco (UNBP.PA: Quote, Profile, Research), Europe's largest property group by label et value, Corio (COR.AS: Quote, Profile, Research) and Klepierre (LOIM.PA: Quote, Profile, Research) have opted to issue convertible bonds, shares or renerecede tiate debt covenants instead of having a correct s issue.

Firms like these will be better space d to join a chase for discounted assets alongside cash-rich private equity funds, sovereign buyers and institutions who have all rediscovered a taste for real estate, analysts said.  Continued...

Threadneedle sees further rally in emerging bonds

TAIPEI (Reuters) - Fund hoemploy Threadneedle sees emerging label et bonds extfinish ing their gains into 2010 on hopes their economies will grow quick er than developed countries and their currencies will rise against the U.S. execute llar, an exegash ive said on Thursday.

Threadneedle, wholly owned by Ameriprise Financial (AMP.N), expects the bonds to rise 10-15 percent next year, in portion becaemploy public debt to be raised by emerging nations remains less than western rivals.

Total public debt of emerging label ets, such as Venezuela, Brazil, Russia and Inexecute nesia, would account for 35 percent of thir improper execute mestic product in 2014, versus more than 100 percent for the United States, Japan and UK at that time, said Richard Hoemploy , head of emerging label et debt at Threadneedle.

"Broadly speaking, we see at least 10 to 15 percent returns in sovereign bonds next year," Hoemploy tfeeble Reuters on the sidelines of a company event.

"Investors would not acquire the kind of exciting capital gains from these bonds, but their execute wnside risk is limited," he said.

Threadneedle, with $2 billion of assets in emerging label et debt, recently raised its position in Venezuela and Egypt but gash its hfeeble ings in the Philippines and Mexico, said Hoemploy .

The fund hoemploy also expected currencies of emerging label ets to appreciate against the U.S. execute llar in the near future.

"As long as the U.S. follows its loose monetary policy, the U.S. execute llar will continue to weaken," he said.

(Reporting by Faith Hung, Editing by Jacqueline Wong)

L&G funds CEO touts joint investor action

By Claire Milhench

LONDON (Reuters) - Investors must commit to collective action over the next year to force company boards to respond to their concerns, said the chief exegash ive of Legal & General's fund management division.

Peter Chambers is worried that without a concerted effort companies can divide and rule, and other vested interests, including U.S. investment banks, might increasingly impose themselves on UK Plc.

"There is now a noteworthy er understanding for the need for leading investors to engage than there was 6 to 12 months arecede and a noteworthy er willingness to talk to each other so that there can be some form of collective engagement," he tfeeble Reuters.

Large investors were cconceal d for their failure to rein in the corporate excesses laid bare by the financial crisis. Stung by the criticism and encouraged by regulatory proposals and recede vernment support, there are signs the mood has changed among investors, even if the companies they own prove less keen.

"Is it a waste of time and money? That's a judgement call. I can see why some people might judge that given the frustration we've had with some companies over the last two years," Chambers said at the Asset Allocation Summit Europe 2009.

The problem leading investors have is that they execute n't always know what other key sharehfeeble ers are judge ing and can't guarantee that an obliging board will provide the names of sharehfeeble ers who share their concerns.

Regulators are judge ing along the same lines, as indicated by Sir David Walker in his recent review of corporate recede vernance in UK financial services.

LGIM manages about 5 percent of the UK stock label et and had about 270 billion pounds of assets at finish -June. More than 90 percent of its equities portfolio is in passive index funds, a sector which has traditionally lagged others in engagement with directors.  Continued...