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Sovereign Wealth Fund Invests $760m in 2nd Niger Bridge in 2017

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second niger bridge
  • Sovereign Wealth Fund Invests $760m in 2nd Niger Bridge in 2017

The Nigeria, Sovereign Investment Agency (NSIA), operators of the Nigerian Sovereign Wealth Fund (SWF), has disclosed that this year alone, a whopping $760 million is to be invested in the 2nd Niger Bridge in continuation of Federal Government’s investment being undertaken under a Public Private Partnership (PPP).

German construction giant, Julius Berger, is a major stakeholder of the consortium in the partnership deal in the bridge, which was initiated by former President Goodluck Jonathan’s administration.

The second Niger Bridge has remained a key issue in the socio-economic life of the people of the South east and even some South south states, as the existing bridge has become too inadequate to carry the traffic from these regions to other parts of the country. This has resulted in wastage in man hours spent in very long traffic jam as vehicles get stuck driving through the bridge due to its limited capacity.

To fast track economic and social growth in the country, the Fund will be diversified into foreign investments as well as in social infrastructure.

The Managing Director and Chief Executive Officer of the Fund, Uche Orji, made the investment plan for the year known at an interaction in Abuja.

He said: “The NSIA will invest $760 million in the second Niger Bridge project being built in conjunction with Julius Berger.

“The privatisation of the Nigeria Commodity Exchange between Bureau of Public Enterprises (BPE) and the NSIA is expected to be concluded this year at a cost of $10 million.

“We will also directly invest in Customs National Single Window project to improve the technology platform of customs to increase revenue collection and enhance efficiency.

“Also, NSIA and Old Mutual, will commit $500 million for investment in commercial and retail assets. We will also invest in the middle market industralisation projects to stimulate the economy,” he said.

Other areas of investment, he said, included communications, aviation, rail, waste and sewage, gas pipeline, ports, industrial parks, mining and refining.

“On Agriculture, he said the NSIA had also pledged to partly fund 100 million dollars Agricultural Finance in Nigeria (FAFIN) initiative in collaboration with German Development Bank and the Ministry of Agriculture.

He said another 25 million dollars was invested in a $200 million Nigeria Agriculture Fund in partnership with a South Africa firm which had already committed $25 million.

“The NSIA has also invested 286.4 million dollars in a fertilizer blending project in partnership with FEPSAN.

“The objective is to deliver fertilizer to farmers on time and at a reasonable price of N5,500 per 50kg bag of NPK 20:10:10 down from 30 to 40 per cent from current price.

“Our strategy is to import only the ingredients that cannot be sourced locally and blend it with other available ingredients that makes up a fertiliser.

“For the wet season, we are targeting 1 million metric tons in five batches of 200,000 tonnes each starting in this February. Our target is to eliminate subsidy on fertiliser,” he said.

To this effect, Orji said that there were presently 10 blending plants with the total capacity of 1.94 million metric tonnes with the hope of establishing more plants.

Orji said the agency have also helped in the creation of institutions such as the Development Bank of Nigeria to support infrastructure development.

He said the Infrastructure Credit Guarantee Company (InfraCredit), which the agency helped establish last year would make it possible for pension funds and insurance companies to invest in infrastructure through the bond market.

He said the NSIA financial involvement in the Nigeria Mortgage Refinancing Company and the Family Homes Fund in collaboration with the Ministry of Finance will lower cost and improve access to mortgage.

Orji said the additional funding of the agency beyond the 1.25 billion assets under its management is critical to set the pace for higher levels of infrastructure investment, providing buffers against macro-economic shocks.

He welcomed the approval of additional $250 million to the NSIA by the National Executive Committee, saying the agency would strategise on areas to invest the fund pending its arrival.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

Investment

FBNQuest Mutual Funds returns 104%

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FBNQuest Asset Management, a subsidiary of FBN Holdings, has held yearly general meetings for five mutual funds managed by the firm.

The funds are the FBN Balanced Fund, FBN Smart Beta Equity Fund, FBN Eurobond Fund, FBN Bond Fund and the FBN Money Market Fund.

The Fund Manager continues to deliver commendable results, as demonstrated by strong performance across all its funds.

The FBN Bond Fund was the best performing of the mutual funds, returning 104.20 per cent over five-year while its US Dollar fund, the FBN Eurobond, returned 48.43 per cent in US dollars over the same period.

The Managing Director of FBNQuest Asset Management, Ike Onyia, said: “Our strong performance track record is premised on the research capabilities, insights and experience of our portfolio management and research teams. Our mutual funds serve as useful investment options useful in formulating unique and value-adding investment strategies for various client segments. This is because our range of mutual funds cut across various asset classes including equities, bonds and money markets.”

“Our funds remain easily accessible, as our goal is to continue to drive financial inclusion and democratise wealth creation, by supporting the financiainclusion and democratise wealth creation, by supporting the financial security aspiration of investors” he added.

Increasingly, financial markets are becoming complex to navigate and as a result, it will not be out of place for investors to actively seek the inclusion of mutual funds in their investment portfolio, which will serve as the structured gateway to such markets. Seeking the help of experienced financial planners to assist you in establishing your risk tolerance levels and advise on suitable options is highly recommended.

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SEC Warns Against Proliferation of Unregistered Investment Platforms

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The Securities and Exchange Commission (SEC) has warned the investing public to be wary of the proliferation of unregistered online investment and trading platforms facilitating access to trading in securities listed in foreign markets.

SEC’s warning was conveyed via a circular issued in Abuja, Thursday to capital market operators.

It advised the investing public to seek clarification as may be required via its established channels of communication on investment products.

The circular read: “The attention of the SEC has been drawn to the existence of several providers of online investment and trading platforms which purportedly facilitate direct access of the investing public in the Federal Republic of Nigeria to securities of foreign companies listed on securities exchanges registered in other jurisdictions.

“These platforms also claim to be operating in partnership with capital market operators (CMOs) registered with the Commission.”

The Commission categorically stated that by the provisions of Sections 67-70 of the Investments and Securities Act (ISA), 2007 and Rules 414 & 415 of the SEC Rules and Regulations, only foreign securities listed on any exchange registered in Nigeria may be issued, sold or offered for sale or subscription to the Nigerian public.

Accordingly, the SEC notified CMOs who work in concert with the referenced online platforms of the Commission’s position and advised them to desist henceforth.

Public to seek clarification as may be required via its established channels of communication on investment products advertised through conventional or online mediums.

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SoftBank Reaps $33 Billion Coupang Windfall

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SoftBank Group Corp on Thursday racked up a roughly $33 billion gain on paper through the public market debut of South Korea’s largest e-commerce company, Coupang Inc, the latest sign of a dramatic turnaround for its $100 billion Vision Fund.

Shares of Coupang opened 81% above their offer price on Thursday, after the company raised $4.6 billion in the U.S. stock market’s biggest initial public offering this year.

SoftBank paid around $3 billion for a 37% stake in the company, according to sources familiar with earlier fund-raising, giving it a roughly $33 billion headline profit if prices hold.

Coupang’s hugely successful stock market launch is welcome news for SoftBank, which is grappling with the collapse of billions of dollars worth of funds linked to Britain’s Greensill Capital, a supply chain finance start-up.

Vision Fund is Greensill’s biggest backer.

The Japanese conglomerate last month reported third-quarter net profit ballooned more than 20 times thanks to a recovery at the Vision Fund, a huge venture capital operation famous for investing early in Uber and other tech industry startup successes.

Only a year ago, SoftBank had been smarting from the flopped IPO and collapse in value of office sharing firm WeWork, raising questions over whether Chief Executive Officer Masayoshi Son had lost his midas touch and threatening plans to establish a successor to Vision.

The COVID-19 pandemic has also forced Son to sell assets but a second deal reported by Reuters on Thursday bodes well for VF II, a second, smaller fund.

The $225 million late-stage funding round for healthcare startup Forward Health was its first major investment this year, following a pickup in activity and the group’s fortunes in the second half of 2020.

The Vision Fund also made $11 billion on a blockbuster market launch of DoorDash Inc in December, which valued the food delivery company at more than $70 billion.

It also made gains on home seller Opendoor Technologies Inc’s initial offering in December.

The fund still holds large stakes in China’s biggest ride-hailing firm Didi, as well as Uber’s Southeast Asian rival Grab.

SoftBank is also trying to ride the mania for special purpose acquisition companies, launching a handful of blank-check firms this year, although none of them have found investment targets yet.

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