Malaysia’s sovereign wealth fund Khazanah closes London office: Report

The Khazanah Nasional office.

Malaysia’s $39-billion sovereign wealth fund Khazanah Nasional Bhd has closed its London office to redirect its focus on Asian investments, according to a report by The Sunday Times.

Based on an email sent to investors and sighted by The Sunday Times, the fund has quietly closed its doors of the London office at the end of last month.

Khazanah has not responded to DEALSTREETASIA‘s request for comment.

The decision to shut the fund’s London operations, which has about 10 staff, is within expectations as Khazanah’s managing director Shahril Ridza Ridzuan had earlier said that he was considering to do so in order to cut operating costs.

One of the fund’s notable investments in the European region was London-based augmented reality startup Blippar. The startup had filed for insolvency last December, after Khazanah was alleged to have blocked an emergency fundraising by the startup as the funding round would have diluted its shares.

Shahril had also said Khazanah will look to scale down its operations in Turkey.

Formerly CEO of Malaysia’s largest pension fund, the Employees Provident Fund (EPF), Shahril was appointed to lead Khazanah last August, following the formation of the new government under prime minister Mahathir Mohamad.

This March, Khazanah announced a refreshed mandate to grow Malaysia’s long-term wealth amidst an ongoing restructuring, which will see the fund classify its assets into separate commercial and strategic funds.

Earlier this month, it divested $255 worth of shares in one of its strategic assets – electric utility company Tenaga Nasional Bhd. A spokesperson said the sale is part of Khazanah’s ongoing strategy to restructure our portfolio. All the proceeds will be used for the fund’s balance sheet and reinvestment purposes.

In addition, the sovereign wealth fund is working to help Malaysia’s loss-making national carrier Malaysia Airlines Bhd (MAS) to turn around its business. MAS, which is fully-owned by Khazanah, had missed its target to breakeven last year, causing the fund an $1.78 billion impairment loss in 2018.

Also read:

Malaysia’s Khazanah unveils refreshed mandate after a weak 2018

Malaysian state fund Khazanah divests shares worth $255m in Tenaga