Bahrain sov wealth fund to move into bonds, stocks

Thu Jan 28, 2010 1:31pm EST
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By Natsuko Waki

DAVOS, Switzerland (Reuters) - Bahrain's sovereign wealth fund, which invests mostly at home, plans to diversify away from private equity projects and into stocks and bonds, its CEO said on Thursday.

Talal Al Zain also told Reuters that Mumtalakat expects to receive a credit rating this year, which would allow it to tap capital markets for funding, including Islamic bonds.

Mumtalakat, which has assets of around $10 billion, has investments in 35 companies. It holds stakes above 50 percent in more than 15 of those firms.

"We want to diversify. We will be looking at investments across markets. Our immediate focus will be to diversify investments, channel funds more toward liquidity, that is fixed income, equity markets," Zain said in an interview.

A $1 billion motor sports-themed commercial real estate project in Bahrain was likely to be financed by a combination of investment from strategic investors, private sector funding and some of its own equity, he said.

But Mumtalakat would wait to receive its credit rating later this year before issuing bonds.

"Getting a rating, which is to us to be transparent. As we get a rating we will tap capital markets," he said.

GOVERNANCE   Continued...