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Coffeeshop Chit Chat - Barclay's shares drop. Temasek burnt?</TD><TD id=msgunetc noWrap align=right>
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Original Post by BHills
Last night, Barclays banks fell nearly 25% to just 98 pence per share.
18 months ago in July 2007, Temasek bought at 7.20 pounds per share.
Don't know whether they have sold earlier or not because there is no news of them selling and Temasek's website shows they were still holding the shares as at last financial year-end in March 2008.
From 7.20 pounds to 98 pence, it's about 86% loss.
The initial investment was 975 million pounds. Now becomes 98/720 x 975 mil = 132.7 million pounds only. A loss of about 842 million pounds.
Then the Sterling (aka British Pound) fell from about 3.05 in July 2007 to just 2.2 now against the SGD.
So the actual loss in S$ terms could be :
Original investment : S$ 3 billion
Price now = 132.7 x 2.2 = S$ 292 million
=====
Loss = S$ 2.708 billion or about 90% (4% higher than in pounds because pounds has depreciated against S$.)
If have not sold, may be don't have to worry because MM Lee already said our national investments are for the long term and we shouldn't be too worried about their short-term returns.
This is of course in addition to the potential loss of around S$5.5 billion now on the 189 million Bank of America shares (last US$7.18 = stake about US$1.4 billion = S$2 billion) converted from Temasek's stake in Merrill Lynch (cost about US$5 billion = about S$7.5 billion).
In any case, this is nothing when compared to the potential loss (not converted to shares yet) by GIC's investments in UBS (more than S$10 billion loss because the preferences shares have to be converted to common shares at about CHF 52 before end of 2009 and it's trading at CHF 13.33 now) and Citigroup (will be hit if Citigroup goes under because GIC is only holding perpetual convertible preference shares with a strike price of about US$31-$34 and they can choose not to convert.) .
[URL="http://finance.google.com/finance?q=LON:BARC"]http://finance.google.com/finance?q=LON:BARC[/URL]
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[URL="http://sg.finance.yahoo.com/q/bc?s=GBPSGD=X&t=2y"]http://sg.finance.yahoo.com/q/bc?s=GBPSGD=X&t=2y[/URL]
[URL="http://www.temasekholdings.com.sg/me...ses_230707.htm"]http://www.temasekholdings.com.sg/me...ses_230707.htm[/URL]
<!-- BEGIN TEMPLATE: bbcode_quote -->Quote:
<TABLE cellSpacing=0 cellPadding=3 width="95%" border=0><TBODY><TR><TD class=alt2 style="BORDER-RIGHT: 1px inset; BORDER-TOP: 1px inset; BORDER-LEFT: 1px inset; BORDER-BOTTOM: 1px inset">Temasek Holdings Invests in Barclays PLC
23 July 2007, Singapore
Temasek Holdings ("Temasek") confirmed today that it is investing £975 million (approximately S$3 billion) in Barclays PLC ("Barclays") via its newly issued shares at a price of £7.20 per share, representing 2.1 per cent of Barclays' existing issued share capital. Temasek will subscribe to a further £1.5 billion (S$4.5 billion) in Barclays' shares at a price of £7.40 per share, conditional on the completion of the Barclays-ABN Amro merger. £0.5 billion of this subscription amount will be made available to Barclays' existing shareholders through a clawback at the same price. If the clawback is not exercised, Temasek will own 2.9 per cent of the combined entity.
Temasek will also receive a warrant to subscribe for approximately 61 million Barclays ordinary shares with an exercise price of £7.80 per share. The warrant is exercisable within two years from the completion of the conditional subscription.
Senior Managing Director of Temasek, Frank Tang said, "We are pleased to have this opportunity to invest in Barclays. We look forward to supporting them in their strategy to create opportunities for a higher level of sustainable growth. This investment fits well with our interest for long-term exposure to strong players in the financial services sector."
Executive Director Simon Israel added: "Barclays is a very well-managed bank. We are very impressed with its board and management, specifically their strategy, track record and focus on value creation for shareholders. We believe the Barclays' board and management understand what it takes to make the Barclays-ABN Amro merger work and deliver value." </TD></TR></TBODY></TABLE>
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Original Post by BHills
Last night, Barclays banks fell nearly 25% to just 98 pence per share.
18 months ago in July 2007, Temasek bought at 7.20 pounds per share.
Don't know whether they have sold earlier or not because there is no news of them selling and Temasek's website shows they were still holding the shares as at last financial year-end in March 2008.
From 7.20 pounds to 98 pence, it's about 86% loss.
The initial investment was 975 million pounds. Now becomes 98/720 x 975 mil = 132.7 million pounds only. A loss of about 842 million pounds.
Then the Sterling (aka British Pound) fell from about 3.05 in July 2007 to just 2.2 now against the SGD.
So the actual loss in S$ terms could be :
Original investment : S$ 3 billion
Price now = 132.7 x 2.2 = S$ 292 million
=====
Loss = S$ 2.708 billion or about 90% (4% higher than in pounds because pounds has depreciated against S$.)
If have not sold, may be don't have to worry because MM Lee already said our national investments are for the long term and we shouldn't be too worried about their short-term returns.
This is of course in addition to the potential loss of around S$5.5 billion now on the 189 million Bank of America shares (last US$7.18 = stake about US$1.4 billion = S$2 billion) converted from Temasek's stake in Merrill Lynch (cost about US$5 billion = about S$7.5 billion).
In any case, this is nothing when compared to the potential loss (not converted to shares yet) by GIC's investments in UBS (more than S$10 billion loss because the preferences shares have to be converted to common shares at about CHF 52 before end of 2009 and it's trading at CHF 13.33 now) and Citigroup (will be hit if Citigroup goes under because GIC is only holding perpetual convertible preference shares with a strike price of about US$31-$34 and they can choose not to convert.) .
[URL="http://finance.google.com/finance?q=LON:BARC"]http://finance.google.com/finance?q=LON:BARC[/URL]
<TABLE class=ncode_imageresizer_warning id=ncode_imageresizer_warning_1 width=640><TBODY><TR><TD class=td1 width=20>http://forums.fuckwarezone.com.sg/images/statusicon/wol_error.gif</TD><TD class=td2>This image has been resized. Click this bar to view the full image. The original image is sized 902x662 and weights 185KB.</TD></TR></TBODY></TABLE>
[URL="http://sg.finance.yahoo.com/q/bc?s=GBPSGD=X&t=2y"]http://sg.finance.yahoo.com/q/bc?s=GBPSGD=X&t=2y[/URL]
[URL="http://www.temasekholdings.com.sg/me...ses_230707.htm"]http://www.temasekholdings.com.sg/me...ses_230707.htm[/URL]
<!-- BEGIN TEMPLATE: bbcode_quote -->Quote:
<TABLE cellSpacing=0 cellPadding=3 width="95%" border=0><TBODY><TR><TD class=alt2 style="BORDER-RIGHT: 1px inset; BORDER-TOP: 1px inset; BORDER-LEFT: 1px inset; BORDER-BOTTOM: 1px inset">Temasek Holdings Invests in Barclays PLC
23 July 2007, Singapore
Temasek Holdings ("Temasek") confirmed today that it is investing £975 million (approximately S$3 billion) in Barclays PLC ("Barclays") via its newly issued shares at a price of £7.20 per share, representing 2.1 per cent of Barclays' existing issued share capital. Temasek will subscribe to a further £1.5 billion (S$4.5 billion) in Barclays' shares at a price of £7.40 per share, conditional on the completion of the Barclays-ABN Amro merger. £0.5 billion of this subscription amount will be made available to Barclays' existing shareholders through a clawback at the same price. If the clawback is not exercised, Temasek will own 2.9 per cent of the combined entity.
Temasek will also receive a warrant to subscribe for approximately 61 million Barclays ordinary shares with an exercise price of £7.80 per share. The warrant is exercisable within two years from the completion of the conditional subscription.
Senior Managing Director of Temasek, Frank Tang said, "We are pleased to have this opportunity to invest in Barclays. We look forward to supporting them in their strategy to create opportunities for a higher level of sustainable growth. This investment fits well with our interest for long-term exposure to strong players in the financial services sector."
Executive Director Simon Israel added: "Barclays is a very well-managed bank. We are very impressed with its board and management, specifically their strategy, track record and focus on value creation for shareholders. We believe the Barclays' board and management understand what it takes to make the Barclays-ABN Amro merger work and deliver value." </TD></TR></TBODY></TABLE>
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