GIC, Temasek & MAS 01 (May 08 - Aug 09)

[kennynah]

crap !!!! the bulk of the nation as always... gets mesmerized by his eloquence and forgets that the man is a tyrant !

[winston]

DEALTALK-Burned by banks, Temasek digs for resources

* Eyeing metals and oil deals globally
* May do deal in $5 bln range - source
* To cut exposure to financials amid downturn

(For more Reuters DEALTALKS, click [DEALTALK/]) By Saeed Azhar and Joseph Chaney

SINGAPORE/HONG KONG, April 8 (Reuters) - Singapore's Temasek, like other Asian and Middle Eastern sovereign wealth funds, is digging for deals in mining and oil, as it licks its wounds from financial sector investments that have soured in a global crisis.

The state investor is eyeing "aggressively sized" resource assets and could do a deal in the $5 billion range, a source familiar with the situation told Reuters, declining to be identified due to the sensitive nature of such deals.

Energy and resources make up just 5 percent of Temasek's portfolio, worth S$127 billion ($84 billion) at end-November.

The portfolio, bulging with banks such as Standard Chartered and Bank of America , slid 31 percent between March and November. Investments in Merrill Lynch and other financials -- which account for 40 percent of its assets -- are rapidly losing value.

Temasek's shift towards resources will be helped by the experience of Chip Goodyear, former chief of miner BHP Billiton , who succeeds Ho Ching, wife of Singapore's prime minister, as CEO in October.

His appointment is a clear move that Temasek is angling for more resources deals, analysts and investment bankers say.

"The shift by Asian sovereign wealth funds to commodity related investments makes perfect sense from a diversification, as well as strategic geopolitical standpoint," said Kirby Daley, senior strategist, Newedge Group in Hong Kong.

"I wouldn't be surprised if we see much more of this activity going forward." China's $200 billion wealth fund CIC is also looking to invest in energy and commodities. [ID:nPEK136727]

ACTIVE M&A

Temasek may be looking at Canadian miner Teck Cominco Ltd , which is scrambling to sell assets in a bid to raise cash to pay off a $5.8 billion bridge loan, the source familiar with the situation said.

Temasek is more likely to buy minority stakes in assets, another investment banker said, than acquire whole companies.

At a recent mining conference in Singapore, Temasek's managing director for investments, Nagi Hamiyeh, chaired a session with Rio Tinto's CFO Guy Elliott, and effectively interviewed him on the firm's business plans.

"The story of the cycle in resources is still intact, we are further believers of the China story and the urbanisation of China, India and other countries," Hamiyeh told the conference.

Temasek is looking at resources in an opportunistic way, Hamiyeh later told Reuters, seeing active M&A in the sector.

He split the sector between 'thrivers' -- the bigger miners with high quality assets and cashflow -- and 'strivers' -- mostly single asset, pre-production, industry newcomers.

"We believe there will be a new round of significant consolidation led by some of these thrivers with their large cash funds and access to capital," he told the conference.

"The thrivers will go after the high quality strivers and acquire them at very fair valuations. ... We believe there are way too many players in the industry," Hamiyeh said.

A sharp drop in the price of many commodities -- the broad Reuters-Jefferies CRB <.CRB> commodity index has more than halved from last year's peak -- and stressed corporate balance sheets have triggered fire sales for some resources assets.

Swedish copper and zinc miner Boliden , Kazakh copper producer Kazakhmys and India-focused miner Vedanta Resources all appear under pressure to reduce debt and raise equity, according to Goldman Sachs.

Even stronger miners are open to sovereign wealth funds.

Brazil's Vale , the world's biggest iron ore miner, said it wants sovereign wealth funds to invest more in its business after hesitant steps so far. [ID:nSP405157] But a person familiar with Temasek's thinking said the Singapore investor will tread carefully as many countries regard their natural resources as strategic assets.

Some politicians and investors in Australia have opposed a proposed $19.5 billion investment in Rio Tinto by Chinese state-controlled Chinalco.

"The challenge will remain with resource rich countries in terms of how to balance out resource protectionism versus badly needed foreign capital," Hamiyeh said

[kennynah]

and i thought KM has a shot at this CEO position... nevermind...singaporeans can wait long long... of cos...some singaporeans no need to wait... not all singaporeans are made equal...that's life and reality, i'm afraid...

[sidney]

Has anyone tot about repicating index stocks from temasek holdings? Any merits / comments?

[winston]

I do keep an eye on what they are buying. However, there's nothing in their portfolio that I particularly like now ie. Singtel, Chartered, Citic Resources, Li & Fung, DBS, Standard Chartered, Chinese Banks etc..

I would probably be looking at some of their stocks eg. DBS, Standard Chartered, Capitaland & Semb Marine, when business fundamentals improve. However, one can always argue that by that time, they would be more expensive. However, I prefer to see business fundamentals improve first as it would be a long term bet. So missing two to three quarters on a long term play may not be too bad on a risk vs reward basis. I hope ...

[winston]

No mention of Commodities

THE STRAITS TIMES - Singapore's state investor, Temasek Holdings [TEM.UL], has revised its long-term investment direction to focus more on Asia and emerging markets such as Brazil and Russia, with a reduced emphasis on developed economies like the United States and Europe, its outgoing CEO Ho Ching said.

[winston]

Singapore's Temasek says has sold entire BofA stake

Hmm... so how much did they make ?

SINGAPORE, May 15 (Reuters) - Singapore state investor Temasek Holdings [TEM.UL] has divested its entire state in Bank of America , a spokeswoman for the Singapore fund said on Friday.

She disclosed this after a source told Reuters the Singapore fund sold its BofA shares at different prices during the first quarter of 2009.

Temasek got shares of BofA after the U.S. bank bought Merrill Lynch.

[ucypmas]

When Temasek got into Merrill they paid US$5.9 billion.

Subsequently when Merrill raised more funds at a lower share price than what they sold to Temasek they reimbursed them US$2.4b (some kind of provision). They reinvested some back and after the BAC takeover ended up with about 188 mil BAC shares. So assuming that they got US$10 per BAC share they would have realised about US$1.9b back from the sale.

So they lost money - anything between US$2-3b. It looks like there is growing recognition within Temasek what a crock their strategy on financials has been, and with asset prices depressed everywhere they have most of their cash stuck in these sinking banks. At least they are now trying to do something better with what's left. Or so we hope.

[millionairemind]

March 5, 2009
Putting a figure to GIC's losses for the first time since the financial crisis started, MM Lee also acknowledged that GIC had bought shares in global banks UBS and Citigroup 'too early'.

'We expected the market to go down in equities,' he elaborated at the Thomson Reuters Newsmaker Event after his interview. GIC thus reduced equity holdings by 15 per cent to 16 per cent, making it cash-rich and able to pick up stocks like UBS and Citi when the market fell.
'But we went in too early,' he said. 'That's part of the ride. We can tough it out for 10 years, 15 years.'
http://www.straitstimes.com/Breaking%2B ... 46207.html

[winston]

'But we went in too early,' he said. 'That's part of the ride. We can tough it out for 10 years, 15 years.'

What about the Opportunity Cost of those dead money ?