Temasek Holdings
Encyclopedia
Temasek Holdings is an investment company
owned by the government of Singapore
. With an international staff of 380 people, it manages a portfolio
of about S$193 billion (US$157 billion) at end of March 2011, focused primarily in Asia. It is an active shareholder and investor in - financial services
, telecommunications & media
, technology, transportation, industrials, lifesciences, consumer, real estate
, energy & resources.
Temasek is one of a few global firms with the highest corporate credit rating
s by both Standard & Poor's and Moody's
, of AAA and Aaa respectively. It has also attained perfect scores quarterly on the "Transparency
Index for Sovereign wealth fund
s", a measure of the openness of government-owned investment funds.
In addition, the Government of Singapore
has another investment arm, the substantially larger Government Investment Corporation
(GIC), which invests primarily the country's foreign reserves.
Temasek has claimed that it is not strictly a sovereign wealth fund
, in the sense that it "has to sell assets to raise cash for new investments and doesn't require the government to give approvals". This claim, made by a Temasek spokesman in 2008, was subsequently disputed by the Singapore Ministry of Finance's governance and investment director, who asserted that a broad definition of the term "sovereign wealth fund" could include "all state-owned investment vehicles, regardless of their funding" . He noted, however, that the claim had been made in the context of a 2008 agreement between the United States Treasury, the Abu Dhabi Investment Authority
, and GIC
regarding the transparency and non-politicization of investments by sovereign wealth funds, and that Temasek already meets disclosure guidelines and provides more details than required by the agreement .
(later broken up into Malaysia Airlines
and Singapore Airlines
) and the Singapore Telephone Board (which would later become Singapore Telecommunications
). As part of its push for local and foreign private investment in sectors such as manufacturing
and shipbuilding
, the government's Economic Development Board
(EDB) took on minority stakes in a variety of local companies. The government also acquired or established several companies
, such as Keppel Corporation
(originally Sembawang shipyard
, taken over from the British Royal Navy
after it withdrew from the island), ST Engineering (originally a weapon manufacturer
set up to supply the Singapore Armed Forces
), and the shipping company Neptune Orient Lines
.
Prior to the incorporation of Temasek Holdings, most of these stakes were held by the Ministry of Finance
. Temasek was incorporated in 1974 by an Act of Parliament
. The Ministry was set up as (and remains) Temasek's sole shareholder, and the Ministry's various stakes were transferred to it, forming an initial portfolio of just over US$100 million.
Several of the companies in Temasek's initial portfolio were subsequently publicly listed
, although Temasek continues to retain a large (and in some case a majority) stake. As of 2011, it owns approximately 20 percent of Keppel Corporation
, 54 percent of Singapore Telecommunications
, 55 percent of Singapore Airlines
, and 66 percent of Neptune Orient Lines
(see Temasek Holdings' investments
).
In Jan 2008, The Economist
reported that Morgan Stanley
had estimated the fund's assets at US$159.2 billion.
On 5 March 2008, Simon Israel, Temasek Holdings’s executive director, appeared in the US House of Representatives before a joint sub-committee of the House Financial Services Committee in a hearing related to foreign government investments in the United States.
joined Temasek as a Director; subsequently she was appointed Executive Director in May 2002, and Executive Director & CEO in January 2004. She is the wife of Prime Minister Lee Hsien Loong
.
In March 2009, Charles "Chip" Goodyear
was appointed a member of the Board of Directors and CEO-designate, but owing to differences on strategic issues, the Board and Goodyear mutually agreed in July 2009 not to proceed with his appointment and Ho Ching continued as CEO.
In August 2010, a senior panel of three presidents was appointed:
As of 2004, it owns stakes in many large foreign companies, including Standard Chartered, Bank of China
, China Construction Bank
, ICICI Bank
, Global Crossing
, as well as many of Singapore's largest companies, such as SingTel
, DBS Bank, Singapore Airlines
, PSA International
, SMRT Corporation
, Singapore Power
, Neptune Orient Lines
and Mediacorp
. It also holds investments in public icons like the Singapore Zoo
and Singapore Pools
, the only legal betting company in Singapore. On 14 October 2004, it announced that it was closing the operational headquarters of ST Engineering and transferring the latter's assets to itself.
About half of its managed assets are external to Singapore and Temasek-linked companies (TLCs) also hold an extensive global portfolio, such as SingTel's ownership of Australia
n telco Optus
, and Singapore Airlines
' 49% stake in Virgin Atlantic.
Although 75% of Temasek's holdings is in Singapore, it has set a target of eventually reducing this to only one-third. Another one-third will be in developed markets and the final third is planned for investment in developing economies.
Temasek Holdings's total shareholder return is 17% compounded annually since inception in 1974.
Investment company
An investment company is a company whose main business is holding securities of other companies purely for investment purposes. The investment company invests money on behalf of its shareholders who in turn share in the profits and losses....
owned by the government of Singapore
Government of Singapore
The Government of Singapore is defined by the Constitution of the Republic of Singapore to mean the Executive branch of government, which is made up of the President and the Cabinet of Singapore. Although the President acts in his personal discretion in the exercise of certain functions as a check...
. With an international staff of 380 people, it manages a portfolio
Assets under management
Assets under management is a financial term used denote the market value of funds being managed by a financial instutition on behalf of its clients, investors, depositors, etc. This metric is a sign of size and success against competition...
of about S$193 billion (US$157 billion) at end of March 2011, focused primarily in Asia. It is an active shareholder and investor in - financial services
Financial services
Financial services refer to services provided by the finance industry. The finance industry encompasses a broad range of organizations that deal with the management of money. Among these organizations are credit unions, banks, credit card companies, insurance companies, consumer finance companies,...
, telecommunications & media
Mass media
Mass media refers collectively to all media technologies which are intended to reach a large audience via mass communication. Broadcast media transmit their information electronically and comprise of television, film and radio, movies, CDs, DVDs and some other gadgets like cameras or video consoles...
, technology, transportation, industrials, lifesciences, consumer, real estate
Real estate
In general use, esp. North American, 'real estate' is taken to mean "Property consisting of land and the buildings on it, along with its natural resources such as crops, minerals, or water; immovable property of this nature; an interest vested in this; an item of real property; buildings or...
, energy & resources.
Temasek is one of a few global firms with the highest corporate credit rating
Credit rating
A credit rating evaluates the credit worthiness of an issuer of specific types of debt, specifically, debt issued by a business enterprise such as a corporation or a government. It is an evaluation made by a credit rating agency of the debt issuers likelihood of default. Credit ratings are...
s by both Standard & Poor's and Moody's
Moody's
Moody's Corporation is the holding company for Moody's Analytics and Moody's Investors Service, a credit rating agency which performs international financial research and analysis on commercial and government entities. The company also ranks the credit-worthiness of borrowers using a standardized...
, of AAA and Aaa respectively. It has also attained perfect scores quarterly on the "Transparency
Transparency (market)
In economics, a market is transparent if much is known by many about:* What products, services or capital assets are available.* What price.* Where....
Index for Sovereign wealth fund
Sovereign wealth fund
A sovereign wealth fund is a state-owned investment fund composed of financial assets such as stocks, bonds, property, precious metals or other financial instruments. Sovereign wealth funds invest globally. Some of them have grabbed attention making bad investments in several Wall Street financial...
s", a measure of the openness of government-owned investment funds.
In addition, the Government of Singapore
Government of Singapore
The Government of Singapore is defined by the Constitution of the Republic of Singapore to mean the Executive branch of government, which is made up of the President and the Cabinet of Singapore. Although the President acts in his personal discretion in the exercise of certain functions as a check...
has another investment arm, the substantially larger Government Investment Corporation
Government of Singapore Investment Corporation
The Government of Singapore Investment Corporation Private Limited is a sovereign wealth fund established by the Government of Singapore in 1981 to manage Singapore's foreign reserves...
(GIC), which invests primarily the country's foreign reserves.
Temasek has claimed that it is not strictly a sovereign wealth fund
Sovereign wealth fund
A sovereign wealth fund is a state-owned investment fund composed of financial assets such as stocks, bonds, property, precious metals or other financial instruments. Sovereign wealth funds invest globally. Some of them have grabbed attention making bad investments in several Wall Street financial...
, in the sense that it "has to sell assets to raise cash for new investments and doesn't require the government to give approvals". This claim, made by a Temasek spokesman in 2008, was subsequently disputed by the Singapore Ministry of Finance's governance and investment director, who asserted that a broad definition of the term "sovereign wealth fund" could include "all state-owned investment vehicles, regardless of their funding" . He noted, however, that the claim had been made in the context of a 2008 agreement between the United States Treasury, the Abu Dhabi Investment Authority
Abu Dhabi Investment Authority
The Abu Dhabi Investment Authority is a sovereign wealth fund owned by Abu Dhabi, United Arab Emirates founded for the purpose of investing funds on behalf of the Government of Abu Dhabi....
, and GIC
Government of Singapore Investment Corporation
The Government of Singapore Investment Corporation Private Limited is a sovereign wealth fund established by the Government of Singapore in 1981 to manage Singapore's foreign reserves...
regarding the transparency and non-politicization of investments by sovereign wealth funds, and that Temasek already meets disclosure guidelines and provides more details than required by the agreement .
History
At independence, the Singapore government had ownership or joint ownership of a number of local companies, such as Malaysia-Singapore AirlinesMalaysia-Singapore Airlines
Malaysia-Singapore Airlines came into being in 1966 as a result of a joint ownership of the airline by the governments of Malaysia and Singapore. The airline ceased operations after 6 years in 1972 when both governments decided to set up their own national airlines...
(later broken up into Malaysia Airlines
Malaysia Airlines
Malaysian Airline System Berhad , DBA Malaysia Airlines , is the government-owned flag carrier of Malaysia. Malaysia Airlines operates flights from its home base, Kuala Lumpur International Airport, and its eastern hub in Kota Kinabalu. It has its headquarters on the grounds of Sultan Abdul Aziz...
and Singapore Airlines
Singapore Airlines
Singapore Airlines Limited is the flag carrier airline of Singapore. Singapore Airlines operates a hub at Changi Airport and has a strong presence in the Southeast Asia, East Asia, South Asia, and "Kangaroo Route" markets...
) and the Singapore Telephone Board (which would later become Singapore Telecommunications
Singapore Telecommunications
Singapore Telecommunications Limited , commonly abbreviated as SingTel, is a Singaporean telecommunications company, with a combined mobile subscriber base of 416 million customers from its own operations and regional associates in 25 countries at end of June 2011 increased by 19 percent from a...
). As part of its push for local and foreign private investment in sectors such as manufacturing
Manufacturing
Manufacturing is the use of machines, tools and labor to produce goods for use or sale. The term may refer to a range of human activity, from handicraft to high tech, but is most commonly applied to industrial production, in which raw materials are transformed into finished goods on a large scale...
and shipbuilding
Shipbuilding
Shipbuilding is the construction of ships and floating vessels. It normally takes place in a specialized facility known as a shipyard. Shipbuilders, also called shipwrights, follow a specialized occupation that traces its roots to before recorded history.Shipbuilding and ship repairs, both...
, the government's Economic Development Board
Economic Development Board
-Overview:The Economic Development Board is a statutory board of the Government of Singapore that plans and executes strategies to sustain Singapore as a leading global hub for business and investment....
(EDB) took on minority stakes in a variety of local companies. The government also acquired or established several companies
Government-owned corporation
A government-owned corporation, state-owned company, state-owned entity, state enterprise, publicly owned corporation, government business enterprise, or parastatal is a legal entity created by a government to undertake commercial activities on behalf of an owner government...
, such as Keppel Corporation
Keppel Corporation
The Keppel Group of Companies includes Keppel Offshore & Marine, Keppel Integrated Engineering, Keppel Energy, Keppel Telecommunications & Transportation and Keppel Land, among others....
(originally Sembawang shipyard
Sembawang
Sembawang is an area in the Northern-most portion of Singapore, encompassing the largest land mass within the Sembawang Group Representation Constituency. The incumbent Member of Parliament for the Sembawang Constituency is Khaw Boon Wan. The constituency jurisdiction extends into the Woodlands...
, taken over from the British Royal Navy
Royal Navy
The Royal Navy is the naval warfare service branch of the British Armed Forces. Founded in the 16th century, it is the oldest service branch and is known as the Senior Service...
after it withdrew from the island), ST Engineering (originally a weapon manufacturer
Arms industry
The arms industry is a global industry and business which manufactures and sells weapons and military technology and equipment. It comprises government and commercial industry involved in research, development, production, and service of military material, equipment and facilities...
set up to supply the Singapore Armed Forces
Singapore Armed Forces
The Singapore Armed Forces is the military arm of the Total Defence of the Republic of Singapore; as well as the military component of the Ministry of Defence. The SAF comprises three branches: the Singapore Army, the Republic of Singapore Air Force and the Republic of Singapore Navy...
), and the shipping company Neptune Orient Lines
Neptune Orient Lines
Neptune Orient Lines Limited , is a Singapore-based global transport company with core businesses in container shipping and supply chain management...
.
Prior to the incorporation of Temasek Holdings, most of these stakes were held by the Ministry of Finance
Ministry of Finance (Singapore)
The Ministry of Finance , is a ministry of the Government of Singapore responsible for administering and regulating financial institutions and structures of the economy of Singapore. It is headed by the Minister for Finance...
. Temasek was incorporated in 1974 by an Act of Parliament
Act of Parliament
An Act of Parliament is a statute enacted as primary legislation by a national or sub-national parliament. In the Republic of Ireland the term Act of the Oireachtas is used, and in the United States the term Act of Congress is used.In Commonwealth countries, the term is used both in a narrow...
. The Ministry was set up as (and remains) Temasek's sole shareholder, and the Ministry's various stakes were transferred to it, forming an initial portfolio of just over US$100 million.
Several of the companies in Temasek's initial portfolio were subsequently publicly listed
Initial public offering
An initial public offering or stock market launch, is the first sale of stock by a private company to the public. It can be used by either small or large companies to raise expansion capital and become publicly traded enterprises...
, although Temasek continues to retain a large (and in some case a majority) stake. As of 2011, it owns approximately 20 percent of Keppel Corporation
Keppel Corporation
The Keppel Group of Companies includes Keppel Offshore & Marine, Keppel Integrated Engineering, Keppel Energy, Keppel Telecommunications & Transportation and Keppel Land, among others....
, 54 percent of Singapore Telecommunications
Singapore Telecommunications
Singapore Telecommunications Limited , commonly abbreviated as SingTel, is a Singaporean telecommunications company, with a combined mobile subscriber base of 416 million customers from its own operations and regional associates in 25 countries at end of June 2011 increased by 19 percent from a...
, 55 percent of Singapore Airlines
Singapore Airlines
Singapore Airlines Limited is the flag carrier airline of Singapore. Singapore Airlines operates a hub at Changi Airport and has a strong presence in the Southeast Asia, East Asia, South Asia, and "Kangaroo Route" markets...
, and 66 percent of Neptune Orient Lines
Neptune Orient Lines
Neptune Orient Lines Limited , is a Singapore-based global transport company with core businesses in container shipping and supply chain management...
(see Temasek Holdings' investments
Temasek Holdings' investments
Temasek Holdings is an investment company owned by the government of Singapore.-Confirmed Investments:Source: - 2005 :*Temasek, through its 100% owned subsidiary Vertical Theme, bought a 14.73% stake in MPlant which in turns owns Malaysia's smallest bank Alliance Bank...
).
In Jan 2008, The Economist
The Economist
The Economist is an English-language weekly news and international affairs publication owned by The Economist Newspaper Ltd. and edited in offices in the City of Westminster, London, England. Continuous publication began under founder James Wilson in September 1843...
reported that Morgan Stanley
Morgan Stanley
Morgan Stanley is a global financial services firm headquartered in New York City serving a diversified group of corporations, governments, financial institutions, and individuals. Morgan Stanley also operates in 36 countries around the world, with over 600 offices and a workforce of over 60,000....
had estimated the fund's assets at US$159.2 billion.
On 5 March 2008, Simon Israel, Temasek Holdings’s executive director, appeared in the US House of Representatives before a joint sub-committee of the House Financial Services Committee in a hearing related to foreign government investments in the United States.
Management
In January 2002, Ho ChingHo Ching
Ho Ching is the Chief Executive Officer of Temasek Holdings and the wife of the Prime Minister of Singapore, Lee Hsien Loong...
joined Temasek as a Director; subsequently she was appointed Executive Director in May 2002, and Executive Director & CEO in January 2004. She is the wife of Prime Minister Lee Hsien Loong
Lee Hsien Loong
Lee Hsien Loong is the third and current Prime Minister of Singapore. He is married to Ho Ching, who is the Executive Director and Chief Executive Officer of Temasek Holdings. He is the eldest son of Singapore's first Prime Minister Lee Kuan Yew....
.
In March 2009, Charles "Chip" Goodyear
Chip Goodyear
Charles Waterhouse "Chip" Goodyear V is part of the Goodyear lumber and railway family of New York and Pennsylvania.He is a Yale graduate with a science degree in geology & geophysics and an MBA from the Wharton School of the University of Pennsylvania. He rowed on the lightweight crew team at Yale...
was appointed a member of the Board of Directors and CEO-designate, but owing to differences on strategic issues, the Board and Goodyear mutually agreed in July 2009 not to proceed with his appointment and Ho Ching continued as CEO.
In August 2010, a senior panel of three presidents was appointed:
- Greg Curl, former Bank of America chief risk officer, oversees financial services sector and strategy for the Americas
- Simon Israel, executive director, assumes additional rank of president. He stepped down from his board and executive duties in July 2011
- Hsieh Fu Hua, former Singapore ExchangeSingapore ExchangeSingapore Exchange Limited is an investment holding company located in Singapore and providing different services related to securities and derivatives trading and others. SGX is a member of the World Federation of Exchanges and the Asian and Oceanian Stock Exchanges FederationSingapore Exchange...
CEO, appointed executive director & president; he joined as a director in February 2010. He stepped down from the post of president in October 2011, after 13 months in the role.
Board of Directors
- Chairman of the Board: S DhanabalanS DhanabalanSuppiah Dhanabalan was a high-profile political leader in Singapore in the 1980s. He was appointed to several heavyweight cabinet positions in the 1980s and early 1990s under Prime Ministers Lee Kuan Yew and Goh Chok Tong....
- Deputy Chairman of the Board: Chairman and MD of Exxon Mobil Asia Pacific, Kwa Chong Seng
- Executive Director and CEO: Ho ChingHo ChingHo Ching is the Chief Executive Officer of Temasek Holdings and the wife of the Prime Minister of Singapore, Lee Hsien Loong...
- Executive Director: Chairman of Asia Pacific BreweriesAsia Pacific BreweriesAsia Pacific Breweries is an Asian brewery company founded as Malayan Breweries Limited in 1931, in a joint venture between Heineken International and Fraser and Neave, and given its present name in 1990. It currently controls 30 breweries in 12 countries in the Asia Pacific region, selling over...
, Simon Israel - Executive Director: Former CEO of Singapore ExchangeSingapore ExchangeSingapore Exchange Limited is an investment holding company located in Singapore and providing different services related to securities and derivatives trading and others. SGX is a member of the World Federation of Exchanges and the Asian and Oceanian Stock Exchanges FederationSingapore Exchange...
, Hsieh Fu Hua - Director: Former Chairman of DBS Group HoldingsDBS BankDBS Bank Ltd is a bank incorporated in Singapore. It was previously known as The Development Bank of Singapore Limited, before the present name was adopted in July 2003 to reflect its changing role as a regional bank....
, Koh Boon HweeKoh Boon HweeKoh Boon Hwee holds a first class honours degree in mechanical engineering from the Imperial College of Science and Technology, University of London, and an MBA from the Harvard Business School... - Director: Managing Director and Group CEO of ComfortDelGro, Kua Hong Pak
- Director: Managing Director of GK Goh Holdings Ltd, Goh Yew Lin
- Director: Permanent Secretary, Ministry of Finance, Teo Ming Kian
- Director: Chairman of SEBSkandinaviska Enskilda BankenSkandinaviska Enskilda Banken AB is a Swedish financial group for corporate customers, institutions and private individuals with headquarters in Stockholm, Sweden. Its activities comprise mainly banking services, but SEB also carries out significant life insurance operations and also owns Eurocard...
, SAAB ABSaabSaab AB is a Swedish aerospace and defence company, founded in 1937. From 1947 to 1990 it was the parent company of automobile manufacturer Saab Automobile, and between 1968 and 1995 the company was in a merger with commercial vehicle manufacturer Scania, known as Saab-Scania.-History:"Svenska...
, ElectroluxElectroluxThe Electrolux Group is a Swedish appliance maker.As of 2010 the 2nd largest home appliance manufacturer in the world after Whirlpool, its products sell under a variety of brand names including its own and are primarily major appliances and vacuum cleaners...
, Deputy Chairman of EricssonEricssonEricsson , one of Sweden's largest companies, is a provider of telecommunication and data communication systems, and related services, covering a range of technologies, including especially mobile networks...
, Marcus Wallenberg
Investments
- Main article: List of Temasek Holdings' investmentsTemasek Holdings' investmentsTemasek Holdings is an investment company owned by the government of Singapore.-Confirmed Investments:Source: - 2005 :*Temasek, through its 100% owned subsidiary Vertical Theme, bought a 14.73% stake in MPlant which in turns owns Malaysia's smallest bank Alliance Bank...
As of 2004, it owns stakes in many large foreign companies, including Standard Chartered, Bank of China
Bank of China
Bank of China Limited is one of the big four state-owned commercial banks of the People's Republic of China. It was founded in 1912 by the Government of the Republic of China, to replace the Government Bank of Imperial China. It is the oldest bank in China...
, China Construction Bank
China Construction Bank
China Construction Bank is one of the 'big four' banks in the People's Republic of China. To date, it is ranked as the nation's second largest and the second largest bank in the world by market capitalization and 12th largest company in the world. The bank has approximately 13,629 domestic branches...
, ICICI Bank
ICICI Bank
ICICI Bank Ltd. is India's second largest financial services company headquartered in Mumbai, India. It offers a wide range of banking products and financial services to corporate and retail customers through a variety of delivery channels and through its specialised subsidiaries in the areas of...
, Global Crossing
Global Crossing
Global Crossing Limited was a telecommunications company that provides computer networking services worldwide. It maintained a large backbone and offered transit and peering links, VPN, leased lines, audio and video conferencing, long distance telephone, managed services, dialup, colocation and...
, as well as many of Singapore's largest companies, such as SingTel
Singapore Telecommunications
Singapore Telecommunications Limited , commonly abbreviated as SingTel, is a Singaporean telecommunications company, with a combined mobile subscriber base of 416 million customers from its own operations and regional associates in 25 countries at end of June 2011 increased by 19 percent from a...
, DBS Bank, Singapore Airlines
Singapore Airlines
Singapore Airlines Limited is the flag carrier airline of Singapore. Singapore Airlines operates a hub at Changi Airport and has a strong presence in the Southeast Asia, East Asia, South Asia, and "Kangaroo Route" markets...
, PSA International
PSA International
PSA International Pte Ltd, formerly Port of Singapore Authority is the second largest port operator in the world. The company's flagship operations are PSA Singapore Terminals, PSA HNN and PSA Marine...
, SMRT Corporation
SMRT Corporation
SMRT Corporation is a public transport operator incorporated on March 6, 2000, as a result of an industry overhaul to form multi-modal public-transport operators in Singapore. It is the second-largest public-transport company in Singapore after ComfortDelGro...
, Singapore Power
Singapore Power
Singapore Power is a company which provides electricity and gas transmission, distribution services, and market support services to more than a million customers in Singapore. It is the only electricity company in Singapore, and is also one of the largest corporations in Singapore...
, Neptune Orient Lines
Neptune Orient Lines
Neptune Orient Lines Limited , is a Singapore-based global transport company with core businesses in container shipping and supply chain management...
and Mediacorp
MediaCorp
Media Corporation of Singapore, better known as MediaCorp, is a group of commercial media companies in Singapore, with business interests in television and radio broadcasting, interactive media, and, to a lesser extent, print publishing and film-making....
. It also holds investments in public icons like the Singapore Zoo
Singapore Zoo
The Singapore Zoo , formerly known as the Singapore Zoological Gardens and commonly known locally as the Mandai Zoo, occupies 28 hectares of land on the margins of Upper Seletar Reservoir within Singapore's heavily forested central catchment area. The zoo was built at a cost of S$9m granted by...
and Singapore Pools
Singapore Pools
Singapore Pools is the only legal lottery operator in Singapore, incorporated in 1968 to curb illegal gambling. It provides a legal avenue for betting in Singapore....
, the only legal betting company in Singapore. On 14 October 2004, it announced that it was closing the operational headquarters of ST Engineering and transferring the latter's assets to itself.
About half of its managed assets are external to Singapore and Temasek-linked companies (TLCs) also hold an extensive global portfolio, such as SingTel's ownership of Australia
Australia
Australia , officially the Commonwealth of Australia, is a country in the Southern Hemisphere comprising the mainland of the Australian continent, the island of Tasmania, and numerous smaller islands in the Indian and Pacific Oceans. It is the world's sixth-largest country by total area...
n telco Optus
Optus
SingTel Optus Pty Limited is the second largest telecommunications company in Australia, and is a wholly owned subsidiary of Singapore Telecommunications...
, and Singapore Airlines
Singapore Airlines
Singapore Airlines Limited is the flag carrier airline of Singapore. Singapore Airlines operates a hub at Changi Airport and has a strong presence in the Southeast Asia, East Asia, South Asia, and "Kangaroo Route" markets...
' 49% stake in Virgin Atlantic.
Although 75% of Temasek's holdings is in Singapore, it has set a target of eventually reducing this to only one-third. Another one-third will be in developed markets and the final third is planned for investment in developing economies.
Financial highlights
Temasek's financial year ends in March and reports are usually made in July-August.Temasek Holdings's total shareholder return is 17% compounded annually since inception in 1974.
2004
- To satisfy legal requirements in issuing bonds to raise money from the public, Temasek reported its accounts to the public for the first time in its 30-year history on 12 October 2004. Net profit was S$7.4 billion (US$4.4 billion) on revenues of S$56.5 billion for the financial year closing on March 2004. Its 2003 profit was S$241 million on revenues of S$49.65 billion in the previous financial year, while its 2002 profit was S$4.92 billion on revenues of S$42.56 billion.
- The 2004 report states that Temasek manages S$90 billion in assets. This represents an average total shareholder return of 18% year-on-year since 1974. Temasek Holdings has increased transparency over the years, opening its books in 2005. Standard & Poor'sStandard & Poor'sStandard & Poor's is a United States-based financial services company. It is a division of The McGraw-Hill Companies that publishes financial research and analysis on stocks and bonds. It is well known for its stock-market indices, the US-based S&P 500, the Australian S&P/ASX 200, the Canadian...
assigned Temasek Holdings a AAA credit rating for "the best companies". At the time of this report, the various Temasek holdings linked companies held one-third of Singapore's stock market capitalization between them..
2007
- Temasek reported a 29% drop in earnings to S$9.1 billion (US$6 billion) reflecting fewer transactions and a cautious outlook of the market for the year. Its portfolio stood at S$164 billion, breaching the US$100 billion mark for the first time and about 27% higher than 2006.
2008
- Temasek achieved record profits of S$18 billion (US$12 billion), double that of 2007. This was boosted by asset sales of S$17 billion in the past year. Temasek's portfolio grew to S$185 billion (US$134 billion), an increase of 13% from the previous year, including a rare S$10 billion injection by the Singapore government.
2009
- On 10 February, Temasek said its investment portfolio value fell by 31%, or about $39 billion, from March to November last year.
- On 28 May, amidst the Subprime mortgage crisisSubprime mortgage crisisThe U.S. subprime mortgage crisis was one of the first indicators of the late-2000s financial crisis, characterized by a rise in subprime mortgage delinquencies and foreclosures, and the resulting decline of securities backed by said mortgages....
, Singapore's finance minister defended Temasek's performance in parliament, as the wealth fund has made S$56 billion (US$38.5 billion) in the current market cycle that began around March 2003. In this 6-year period, it achieved an annualised return of 15%, better than the MSCI global equity markets' 6% returns and 'respectably' compared to other reputable institutional investors.
2010
- On 8 July, Temasek reported a 42% full recovery of its portfolio to S$186bn (US$134bn), but net profit fell 26% to S$4.6 billion. S$10 billion new investments were made over the year, with the most recent in resources and energy sectors.
- As of 31 March 2010, total investments within Asia increased from 74% to 78%, OECD dipped from 22% to 20%. About 23% of investments by value are unlisted assets. It is likely to maintain its Asia focus in the near future.
- SingBridge International was established to develop integrated townships and large-scale projects in Asia.
- Seatown was established and seeded with S$4 billion as a pilot project to invest independently of Temasek, with ability to hedge positions. It may invite external institutions to co-invest in 3-5 years and the public in 8-10 years.
- It cited protectionism in developed countries, the European sovereign debt crisis and asset bubbles in developing economies among risks for a slower recovery.
Controversy
Temasek is fully owned by Singapore's Ministry of Finance, and these close links to the government have on several occasions caused protests in foreign countries.- When ST Telmedia (STT CommunicationsSTT CommunicationsSTT Communications is a wholly owned subsidiary of Singapore Technologies Telemedia , a private investment holding company part of Temasek Holdings. STT Communications has significant stakes in Global Crossing, U Mobile, SkyCable and StarHub....
), a Temasek-linked company (TLC), took a significant stake in Indonesian IndosatIndosatPT Indosat Tbk., formerly known as PT Indonesian Satellite Corporation Tbk. is a provider of telecommunication services in Indonesia. It is the third largest telecommunication company for mobile services in Indonesia after defeat by XL Axiata...
, workers went on strike to protest working for Singapore.
- In 2003, when ST Telemedia (STT CommunicationsSTT CommunicationsSTT Communications is a wholly owned subsidiary of Singapore Technologies Telemedia , a private investment holding company part of Temasek Holdings. STT Communications has significant stakes in Global Crossing, U Mobile, SkyCable and StarHub....
) acquired a two-third share of computer networking telco Global CrossingGlobal CrossingGlobal Crossing Limited was a telecommunications company that provides computer networking services worldwide. It maintained a large backbone and offered transit and peering links, VPN, leased lines, audio and video conferencing, long distance telephone, managed services, dialup, colocation and...
, the acquisition had to be approved by the U.S. government to ensure a foreign government did not control the extensive network.
- Temasek's 2006 acquisition of Shin CorporationShin CorporationShin Corporation is one of the largest conglomerates in Thailand.- History :It was founded in 1983 as Shinawatra Computer by Thaksin Shinawatra, former Prime Minister of Thailand, and took on its current name in 1999, by using the first four letters of his last name...
, owned by the family of then Thai prime minister Thaksin ShinawatraThaksin ShinawatraThaksin Shinawatra is a Thai businessman and politician, who was Prime Minister of Thailand from 2001 to 2006, when he was overthrown in a military coup....
, was particularly controversial, with protestors burning effigies of Lee and Ho on the streets of Bangkok. The deal was a factor in exacerbating the Thai political crisisThailand political crisis 2005-2006In 2005 and 2006, a series of events occurred in Thailand as a result of an unrest with Thaksin Shinawatra that was supported by Sondhi Limthongkul and his coalitions...
, which eventually led to the downfall of Thaksin and a review of the transaction's legality. The military junta that overthrew Thaksin, later tried unsuccessfully to force Temasek to divest a large part of its investment in Shin Corp. As of 2011, Temasak still effectively controls the majority of share in Shin Corporation which changed its name to Intouch Corporation via its affiliates.
External links
- Singapore: Government-linked corporations face the future. Embassy of the United States, Singapore. March 2001