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Pension Funds

PIC acquires 25% stake in South African stock exchange on behalf of national pension fund

Public Investment Corp., which manages the assets of South Africa's Government Employees Pension Fund, Pretoria, agreed to acquire a 25% stake in stock exchange ZAR X on behalf of the 1.6 trillion rand ($131 billion) pension fund, PIC said in a statement Monday.

ZAR X was launched in 2014 by the Financial Services Board, South Africa's financial regulator, as part of a directive to move the existing over-the-counter equity trading market to a licensed exchange. Additional details about the value of the deal could not be learned by press time.

"This transaction provides us with an opportunity to own a portion of the stock exchange whilst at the same time affording us an alternative platform from which to trade and on which to list. This will further assist us in our resolve to bring about meaningful change in and transformation of the domestic capital markets and overall financial services industry landscape," said Deon Botha, head of corporate affairs at PIC, in a news release. PIC has 1.9 trillion rand in assets under management.

GEPF completed an asset-liability study during its latest actuarial valuation at the beginning of 2017. As a result, the pension fund is reviewing its strategic asset allocation and its exposure to foreign securities, a GEPF spokesman told Pensions & Investments in November. GEPF has investment limits on foreign securities, which stand at the maximum of 4% for foreign bonds and 5% for foreign equities.