Tag: investors

First Data in $3.5B private investment led by KKR

First Data announced on Thursday that its parent has received commitments to purchase about $3.5 billion of equity in a private placement, led by KKR. The proceeds will be used to repay portions of the company’s debt.

The private placement includes $1.5 billion from existing investors and $2 billion from new investors, including pension funds, mutual funds, asset managers, and individuals. KKR provided roughly $1.2 billion, First Data said.

KKR’s balance sheet will have approximately $1 billion invested in First Data’s equity.

“We have taken full advantage of the last 12 months to strengthen our company through a total focus on serving our clients and bringing them new innovations that help them grow their business,” Frank Bisignano, chairman and chief executive officer of First Data, said in a statement. “The new investment will unlock $375 million per year to help us accelerate our transformation.”

Central Banks are buying stocks

The FT reports that “a cluster of central banking investors has become major players on world equity markets.”

The report, to be published this week by the Official Monetary and Financial Institutions Forum (OMFIF), confirms $29.1tn in market investments, held by 400 public sector institutions in 162 countries, which “could potentially contribute to overheated asset prices.” China’s State Administration of Foreign Exchange has become “the world’s largest public sector holder of equities”, according to officials, and we suspect the Fed is close behind.

Central banks around the world, including China’s, have shifted decisively into investing in equities as low interest rates have hit their revenues, according to a global study of 400 public sector institutions.

“A cluster of central banking investors has become major players on world equity markets,” says a report to be published this week by the Official Monetary and Financial Institutions Forum (Omfif), a central bank research and advisory group. The trend “could potentially contribute to overheated asset prices”, it warns.

The report, seen by the Financial Times, identifies $29.1tn in market investments, including gold, held by 400 public sector institutions in 162 countries.

China’s State Administration of Foreign Exchange has become “the world’s largest public sector holder of equities”, as the report argues is “partly strategic” because it “counters the monopoly power of the dollar” and reflects Beijing’s global financial ambitions.

In Europe, the Swiss and Danish central banks are among those investing in equities. The Swiss National Bank has an equity quota of about 15 per cent. Omfif quotes Thomas Jordan, SNB’s chairman, as saying: “We are now invested in large, mid- and small-cap stocks in developed markets worldwide.” The Danish central bank’s equity portfolio was worth about $500m at the end of last year.