China fund buys stake in British utility

China's $410-billion sovereign wealth fund said Friday it had bought a stake in British utility company Thames Water, days after the Chancellor of the Exchequer George Osborne held talks in Beijing. China Investment Corporation (CIC) said in a statement it had acquired 8.68 percent of the company -- the largest water and sewage service provider in Britain -- through a wholly-owned subsidiary. It did not disclose the price. CIC was established in 2007 to invest some of China's huge foreign exchange reserves, the world's largest at $3.18 trillion by the end of 2011, on the global financial markets. The latest deal comes after chairman Lou Jiwei said CIC would invest in European and US infrastructure as Beijing seeks better returns for its foreign exchange holdings. In an article published by the Financial Times, Lou also said CIC was keen to team up with fund managers or participate in public-private-partnerships in Britain. Osborne met Vice Premier Wang Qishan, China's top finance official, and the heads of CIC and ICBC -- the largest bank in the world -- on Tuesday during a visit aimed partly at attracting investment in British infrastructure. He also made a brief visit to Hong Kong, where he announced Britain had agreed to partner with the Chinese territory to develop the City of London as a major offshore centre of trade in China's yuan currency.