Saudi sovereign wealth fund splashes cash in 2023

© Reuters. A Saudi dealer displays shares on the Saudi inventory market in Riyadh, Saudi Arabia, January 8, 2020. REUTERS/Ahmed Yosri/File Photograph

By Libby George

LONDON (Reuters) -Saudi Arabia’s Public Funding Fund accounted for a few quarter of the just about $124 billion spent by sovereign wealth funds worldwide final yr, a report revealed on Jan. 1 confirmed.

PIF’s whopping $31.5 billion spend in 2023 in contrast with $123.8 billion for all sovereign wealth funds, based mostly on a preliminary annual report from business specialist World SWF, which tracks the world’s sovereign funding funds.

The sturdy rally final yr in international shares helped to swell the property managed by the sovereign wealth funds worldwide to a report $11.2 trillion.

Complete sovereign-controlled spending on the power transition – every part from inexperienced hydrogen to lithium mining – additionally hit a report $25.9 billion in 2023, the report stated.

Regardless of this, whole spending by the sovereign wealth funds final yr was 21% under 2022.

“This may occasionally sign an excessively cautious method, as there is no such thing as a scarcity of capital to place to work amongst these establishments,” World SWF managing director Diego López stated within the report.

Singapore’s GIC, which led spending by wealth funds for the previous six years, invested 48% much less in 2023, regardless of a $144 billion influx from the nation’s central financial institution.

Gulf funds have been in a position to enhance their dealmaking dominance, largely on the expense of Canadian and Singaporean funds, the World SWF report confirmed. Gulf funds now account for almost 40% of the funding worth deployed by sovereign wealth funds.

Information offered by teams comparable to World SWF is intently watched as not all sovereign funds launch annual experiences, and 5 of the highest 10 don’t reveal an actual whole of their property underneath administration.

GAMING AND SPORT

World SWF’s report didn’t get away particular person investments by Saudi Arabia’s PIF, however its lavish spending on soccer and golf has made waves throughout the sporting world.

In June, Saudi Crown Prince Mohammed bin Salman introduced PIF would take management of the nation’s 4 main soccer golf equipment, Al-Ittihad, Al-Ahli, Al-Hilal and Cristiano Ronaldo’s Al-Nassr.

In June, Saudi surprised the golf world, with a shock merger settlement between the PGA Tour, DP World Tour and rival LIV circuit, which is backed by the Saudi PIF. That merger just isn’t but finalised.

Other than its splurge on sport, the Kingdom’s largest investments have been in different sectors and 42% of this spending was at dwelling.

Huge-ticket purchases included $4.9 billion for U.S. gaming firm Scopely, $3.6 billion to purchase Customary Chartered (OTC:)’s plane leasing division and $3.3 billion for steelmaker Hadeed.

“The number of offers exhibits the unparalleled bandwidth and attain of PIF and its subsidiaries, that are forming a large web to seize any value-add for Saudi Imaginative and prescient 2030,” López stated, referring to the nation’s financial transformation plan.

The World SWR report additionally highlights PIF plans to launch an airline and its personal electrical automobile model. The report stated the fund has an $8.1 billion stake in gaming firms Activision Blizzard (NASDAQ:), Digital Arts (NASDAQ:) and Take-Two (NASDAQ:) – a part of plans to show the nation right into a gaming hub.

Looking forward to 2024, World SWF expects property for all state-owned buyers – together with sovereign wealth funds, central banks and pension funds — to surpass a earlier peak in 2021 of $50.8 trillion in property underneath administration as they take account of the paper features of the previous yr.