|Investment company / sovereign wealth fund|
Lim Boon Heng|
(Executive director & CEO)
|Revenue||S$97.0 billion (2017)|
|S$32 billion (2018)|
|Total assets||S$308 billion (2018)|
|Owner||Government of Singapore|
Temasek Holdings Private Limited (abbreviated as Temasek) is a state-owned holding company that can be characterized as a national wealth fund owned by the Government of Singapore. Incorporated in 1974, Temasek owns and manages a net portfolio of $308 billion (as of 31 March 2018), with S$16 billion divested and S$29 billion invested during the year, and 68% exposure to Asia – 27% Singapore and 41% Asia ex-Singapore. It is an active shareholder and investor, and its investments are guided by four key themes – transforming economies, growing middle income populations, deepening comparative advantages and emerging champions. Its portfolio covers a broad spectrum of sectors including financial services, telecommunications, media and technology, transportation and industrials, life sciences and agribusiness, consumer and real estate, energy and resources, as well as multi-sector funds. Headquartered in Singapore, Temasek has a multinational team of 730 people, in 11 global offices including 2 offices in Beijing, and 1 office in Shanghai, Mumbai, Hanoi, London, New York, San Francisco, Mexico City, Washington, D.C., Sao Paulo.
Temasek is commonly referred to as a sovereign wealth fund, particularly by the press and research outlets based outside Singapore. However, it has frequently disputed this terminology, and prefers to be referred to as an investment company, because it invests mostly in equities, is the outright owner of many assets, and pays taxes like other commercial investment firms.
Temasek has credit ratings of “AAA/Aaa” by Standard & Poor's Global Ratings and Moody's Investors Service respectively since their inaugural ratings in 2004. Temasek has also attained perfect quarterly scores on the Linaburg-Maduell Transparency Index, a measure of the openness of government-owned investment funds.
At the point of Singapore's independence in August 1965, the Government of Singapore had ownership or joint ownership of various local companies, such as Malaysia-Singapore Airlines (later split up into Malaysia Airlines and Singapore Airlines) and the Singapore Telephone Board (which became 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) also bought minority stakes in a variety of local companies. During the first ten years after independence, the government acquired or established several companies, such as the Keppel Corporation (originally Keppel Shipyard, taken over from the Royal Navy after the British military withdrawal from Singapore), ST Engineering (originally a weapon manufacturer set up to supply the Singapore Armed Forces), and the shipping company Neptune Orient Lines.
In 1974, Temasek was incorporated under the Singapore Companies Act to hold and manage the assets previously held directly by the Singapore government. The goal was for Temasek to own and manage these investments on a commercial basis, allowing the Ministry of Finance and the Ministry of Trade and Industry to focus on policymaking. Temasek's established mission was to contribute to Singapore's economic development, industrialisation, and financial diversification by nurturing effective and commercially driven strategic investments in and around Singapore.
Temasek is a company incorporated in Singapore, and operates under the provisions of the Singapore Companies Act. It is neither a government agency nor a statutory board. Like any other commercial company, Temasek pays taxes that contributes to government revenue in the countries it operates in, distributes dividends to its shareholder and has its own board of directors and a professional management team. Its sole shareholder is Singapore's Ministry of Finance.
Temasek is designated a Fifth Schedule entity under the Singapore Constitution, which imposes certain safeguards to protect the government's past reserves. For instance, the approval of the President of Singapore is required for any transaction which is likely to result in a draw-down of Temasek's cash reserves. The president also has the right to appoint, terminate, or renew the members of Temasek's board of directors. In most other respects, however, Temasek operates as an independent commercial investment holding company.
In a 2009 speech, Ho Ching, Temasek's Executive Director and CEO, said that the company had made an effort to instill discipline and professionalism, and to be tested and measured by providing public markers of performance. She noted that Temasek's bonds spreads and credit ratings have been regularly and independently monitored as public markers of Temasek's financial position and credit risks. Temasek had also openly and accurately disclosed its financial information through its annual report (although Ho said that, as a private company, it was not legally obliged to do so).
Temasek's initial portfolio of S$354 million comprised shares in the following companies, start-ups and joint ventures previously held by the Singapore Government. The companies included a bird park, a hotel, a shoe maker, a detergent producer, naval yards converted into a ship repair business, a start-up airline, and an iron and steel mill.
Temasek Family of FoundationsEdit
Temasek's family of six foundations and 18 endowments champion various public good causes, including sustainability and innovative solutions to improve liveability and mitigate climate changes, as well as to build a more resilient and inclusive world for our future generations.
In June 2018, Temasek invested S$340 million in a minority stake in UST Global, a digital technology services company. The size of the take was not disclosed.
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.
Temasek's 2006 acquisition of Shin Corporation, owned by the family of then Thai prime minister Thaksin Shinawatra, 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 crisis, 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 2015, Temasek's stake in Intouch Corporation (as Shin Corporation was renamed) had reduced to 42%.
In 2016, Temasek sold a 21% stake in Intouch Holdings, the Thai telecoms conglomerate formerly known as Shin Corp.
In 2012, Singaporean blog TR Emeritus alleged that the appointment of Ho Ching, Singapore Prime Minister Lee Hsien Loong's wife, as CEO of Temasek Holdings was a case of cronyism and nepotism, which was subsequently deleted and for which they apologised.
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