China Investment Corp., which moved Friday to take a 17-per-cent stake in Teck Resources Ltd., is a state-owned sovereign wealth fund with $200-billion (U.S.) of assets under management, making it one of the world's largest sovereign wealth funds.
Formed in 2007, the fund is responsible for investing a portion of China's $2-trillion in currency reserves for the benefit of the state. After being burned by earlier investments in financial services firms, CIC shifted its focus to natural resources, fixed income and real estate.
CIC says its investments are not limited by any particular sector, region or asset class, but the fund has been placing a heavier emphasis on commodities recently and has embarked on a hiring spree to increase its expertise in that area.
In a news release, CIC said it has acquired its stake in Teck “for investment purposes as a long-term passive financial investor and has agreed to hold the purchased shares for at least one year following the closing.”
CIC has also ventured back into the financial sector, recently purchasing $1.2-billion in Morgan Stanley common stock.
CIC says its mission is to make long-term investments “that maximize risk-adjusted financial returns for the benefit of its shareholder.”
Although concerns have been raised in a number of industrialized countries about sovereign wealth funds owning key assets, CIC says on its website, it “usually does not take a controlling role – or seek to influence operations – in the companies in which it invests.”
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