The giant Norwegian
The Norwegian Ministry of Finance last year outlined plans for the establishment of the environmental program, saying that about NOK4 billion would be invested in environment-related opportunities in 2010. The total allocated to the program is predicted to reach as much as NOK20 billion over a five-year period.
Sovereign wealth funds are a growing source of capital for private equity funds. Total assets under management of all sovereign wealth funds stand at an estimated $3.51 trillion, representing a nine percent increase from one year ago, according to The 2010 Sovereign Wealth Fund Review published in March by alternative asset data provider Preqin. More than half of sovereign wealth funds (55 percent) are known to invest in private equity, 51 percent in real estate, 47 percent in infrastructure and 37 percent in hedge funds.
Prequin research also finds thay another 5 percent are considering setting a maiden allocation to the asset class. Along with the Government Pension Fund Global,
Of those sovereign wealth funds that invest in private equity, 92 percent have a preference for buyout funds, according to Preqin. In recent years, a number of the largest known fund commitments by sovereign wealth funds have gone to buyout funds. Examples in the Preqin report include
Nearly two-thirds of sovereign wealth funds investing in private equity funds are also known to seek investments in venture funds, according to the Preqin report. Ireland’s
As part of its growing focus on alternative assets, the Norwegian Ministry of Finance also recently announced that up to 5 percent of the Government Pension Fund Global would be invested in real estate, or about NOK130 billion, at the expense of bond investments.
The Government Pension Fund Global is a sovereign wealth fund into which is deposited the surplus wealth produced by Norwegian petroleum income. The fund changed its name in January 2006 from The Petroleum Fund of Norway. Norges Bank Investment Management forecasts that the fund will reach NOK2.8 trillion by the end of 2010 and NOK4.8 trillion by the end of 2014.