The businesss of GIC is to buy bankrupt business

[Leepotism]

Singapore fund is $1.5 bln bidder for Paulson hotel group




NEW YORK | Mon Aug 20, 2012 11:22am EDT


NEW YORK Aug 20 (Reuters) - The Government of Singapore Investment Corp has bid $1.5 billion for a group of bankrupt hotels owned by hedge fund Paulson & Co, including the Arizona Biltmore Resort & Spa in Phoenix and La Quinta Resort & Club in La Quinta, California.

The MSR Resort hotel group, which also includes Grand Wailea Resorts Hotel & Spa in Hawaii and the Claremont Resort & Spa in Berkeley, California, said it had chosen GIC as the 'stalking horse' or low bidder for the hotels, after looking for an initial bidder since May.

It said it had also spoken with possible equity investors for a reorganization of the hotels before deciding on the GIC offer.

GIC is a sovereign wealth fund that manages Singapore's foreign reserves and is a large real estate investor in the United States. It is a lender to the hotel group and had already made an offer for the group shortly after the bankruptcy filing. It offered $1.5 billion in cash and debt but the resort group rebuffed it, saying it would try to do better for creditors.

Paulson bought the hotels from Morgan Stanley in 2011 and put them into bankruptcy a month later, saying it planned to reorganize them. It already sold one of the hotels, the Doral Golf Resort & Spa in Miami, Florida, to Donald Trump.

Morgan Stanley Real Estate, part of Morgan Stanley, had purchased the five hotels and three others in 2007 for about $4 billion. The hotels filed with $2.2 billion in assets and $1.9 billion in debt.
The $1.5 billion includes up to $1.12 billion in cash and paying off up to $360 million in debt-related claims, according to court documents.

The fund has arranged for a $28 million break-up fee if the hotel group selects another bidder during a bankruptcy auction that it hopes to hold on Oct. 25. A hearing in which the judge will consider the stalking horse bid and sales process is scheduled for Sept. 10.
The case is in Re: MSR Resort Golf Course, U.S. Bankruptcy Court, District of Delaware, No. 11-10372.

 

[Leepotism]

Ditto Temasek. Former finance minister Tony Tan said that Singapore can afford to buy another to buy 2 to 3 bankrupt banks.

 

[halsey02]

Cheap sale mah! SINgaporeans love Cheep sale! and long term mah!, your CPF withdrawal will begin at 85! and if you can not reach that age, your CPF money will be transferred to your descendants CPF accounts, in which they will also withdraw at 85!!

It's long term...mahhhh!!

 

[myo539]

Ditto Temasek. Former finance minister Tony Tan said that Singapore can afford to buy another to buy 2 to 3 bankrupt banks.

Temasek Holding and GIC must do a re-think in their investment strategy. They - and some wealthy Singaporean investors included - seem to have a tendency to play the white knights out to salvage a floundering company. They gather that they can do better than what the established company cannot do.

That's probably wishful thinking - no matter how heroic it may seem. You may pay the highest salary to the CEO to front the floundering company - usually an angmoh - but we need to ask what can GIC or Temasek can do that the established company cannot do? These companies probably too have paid not one - but often several succeeding CEOs to the rescue. It's only when they have failed - and realise the hopelessness of the situation - that they finally filed for bankcruptcy. It feels good - gives you a sense of euphoria - that the new owner can transform a bankrupt company to a promising one with high potential. It could be wishful thinking.

Temasek must factor in that they must still operate under the same environment and same rules in that country - no government is going to change for Temasek sake (or they may change rules against Temasek in the case of Indon). Other countries don't operate like Singapore where Temasek aka the Government owns and operate countless commercial enterprises. There are several examples to show sky-high salary foreign CEOs are not working all the times - or even at all. Well, some feel it's part and parcel of doing business - taking "calculated risk". I thought the Singaporeans who tried to "rescue" indebted Manchester United FC or Ranger FC (may be even F1) look like fools. They did not succeed - a blessing in disguise actually - it saves them a lot of money actually - it gives them good publicity though.

That's how I feel as an ordinary man in the street. The day we can have a Ho Kwon Ping who turned a toxic abandoned tin-mine in Thailand into a 6-star golden resort is over, I think. Yes, Ho may have made a bad business decision that nearly bankcrupted Wah Chang, but he operates in a family-own enterprise - not a public-funded organisation. That's a big difference. http://infopedia.nl.sg/articles/SIP_434_2005-01-14.html
There are many thousands of Ho Kwon Pings out there who think likewise and are smelling and lurking like sharks ready for the frenzy. "Ignorant" Singaporeans may not be ready for it - unlike Hong Kongers or Taiwanese - one is "shameless" and the other "ruthless" - LKY's wise words sounding more ominous now.

Finally, Temaske or GIC may NOT have "the capacity to unshackle these businesses" (Quote from DBS CEO Gupta announcing a hefty price for Indon Bank Danamon shares)

 

[myo539]

Cheap sale mah! SINgaporeans love Cheep sale! and long term mah!, your CPF withdrawal will begin at 85! and if you can not reach that age, your CPF money will be transferred to your descendants CPF accounts, in which they will also withdraw at 85!!

It's long term...mahhhh!!

You are not being helpful by not stating the truth. I supposed you are not ignorant nor dull. You don't withdraw your CPF only at age 85!

You can withdraw your CPF money at age 55. You need only to save a minimum sum for retirement life which you can start withdrawing from age 62 to 65. You can do so even if you continue working.

If you are impatient or scary that the government will eat your money (which is individually miniscule against CPF colossal collectiion), you can't exercise premature withdrawals before you reach age 55. You can use the CPF money for your housing (which practically most of us do), child's university education, insurance, investment, etc.

That's the long term basic financial planning the government does for you - FOC.

 

[Leepotism]

Cheap sale mah! SINgaporeans love Cheep sale! and long term mah!, your CPF withdrawal will begin at 85! and if you can not reach that age, your CPF money will be transferred to your descendants CPF accounts, in which they will also withdraw at 85!!

It's long term...mahhhh!!

Cheap sales or expensive buy. The $um does not look like a lelong.

 

[halsey02]

You are not being helpful by not stating the truth. I supposed you are not ignorant nor dull. You don't withdraw your CPF only at age 85!

You can withdraw your CPF money at age 55. You need only to save a minimum sum for retirement life which you can start withdrawing from age 62 to 65. You can do so even if you continue working.

If you are impatient or scary that the government will eat your money (which is individually miniscule against CPF colossal collectiion), you can't exercise premature withdrawals before you reach age 55. You can use the CPF money for your housing (which practically most of us do), child's university education, insurance, investment, etc.

That's the long term basic financial planning the government does for you - FOC.

gee!, good gracious! you can not even see a pun? are you that dense? who doesn't know you can withdraw at 55 & keep it with my 'mother' (CPF) until I am 65 & my 'mother', will slowly pay me...

who doesn't know the government ... I don't, we don't, we must be a numbskull...

 

[Papsmearer]

Temasek Holding and GIC must do a re-think in their investment strategy. They - and some wealthy Singaporean investors included - seem to have a tendency to play the white knights out to salvage a floundering company. They gather that they can do better than what the established company cannot do.

That's probably wishful thinking - no matter how heroic it may seem. You may pay the highest salary to the CEO to front the floundering company - usually an angmoh - but we need to ask what can GIC or Temasek can do that the established company cannot do? These companies probably too have paid not one - but often several succeeding CEOs to the rescue. It's only when they have failed - and realise the hopelessness of the situation - that they finally filed for bankcruptcy. It feels good - gives you a sense of euphoria - that the new owner can transform a bankrupt company to a promising one with high potential. It could be wishful thinking.

Temasek must factor in that they must still operate under the same environment and same rules in that country - no government is going to change for Temasek sake (or they may change rules against Temasek in the case of Indon). Other countries don't operate like Singapore where Temasek aka the Government owns and operate countless commercial enterprises. There are several examples to show sky-high salary foreign CEOs are not working all the times - or even at all. Well, some feel it's part and parcel of doing business - taking "calculated risk". I thought the Singaporeans who tried to "rescue" indebted Manchester United FC or Ranger FC (may be even F1) look like fools. They did not succeed - a blessing in disguise actually - it saves them a lot of money actually - it gives them good publicity though.

That's how I feel as an ordinary man in the street. The day we can have a Ho Kwon Ping who turned a toxic abandoned tin-mine in Thailand into a 6-star golden resort is over, I think. Yes, Ho may have made a bad business decision that nearly bankcrupted Wah Chang, but he operates in a family-own enterprise - not a public-funded organisation. That's a big difference. http://infopedia.nl.sg/articles/SIP_434_2005-01-14.html
There are many thousands of Ho Kwon Pings out there who think likewise and are smelling and lurking like sharks ready for the frenzy. "Ignorant" Singaporeans may not be ready for it - unlike Hong Kongers or Taiwanese - one is "shameless" and the other "ruthless" - LKY's wise words sounding more ominous now.

Finally, Temaske or GIC may NOT have "the capacity to unshackle these businesses" (Quote from DBS CEO Gupta announcing a hefty price for Indon Bank Danamon shares)

I have some bad news for you, there is no investment strategy at Temasek or even GIC. They like you to think they have one, but they really don't. If you look at Warren Buffet, you will see that he has a clearly defined strategy that he applies to all his acquisitions. Temasek and GIC vacillate all over the place. Taking Temasek for example, they initially invested mostly in the the local market, hence bidding up the shares they already own and making a profit there. than they decided to go in finance, buying HKG and Thai banks. After losing their shirts, they decided to be venture capitalists and invested in some really iffy businesses like Vietnamese start up airlines. Than they decided that they would go into mining companies and hired Goodyear, but that turned out to be a dud and he was gone in less than 1 year with some silence money. What kind of strategy do they have than?

In certain countries in this region, Temasek is looked at as a bunch of easy singaporean suckers. U can package any piece of junk and they will buy it. Unlike what you say, Temasek has never ever once bought a company with the thought of running it better and turning it around into a profitable enterprise. They don't know how to do that and most of the time, leave the existing management in place.

Temasek buys businesses not through thorough research but through unlicenced business brokers. If you have a lousy bank and u want to sell it, u hire a broker who will go into Temasek and stroke Ho Jinx's s ego, and carry Iswaran's balls until they agree to buy the crap bank he is selling them. Everyone wins except the people of singapore, because the owner of the bank gets to unload a lousy company, the broker makes a nice fat commission, someone's palms at Temasek gets grease with a nice fee, and the taxpayer is left holding the bag.

Unlike other soveriegn wealth funds like the KIO (Kuwait Investment Office), Temasek cannot simply pump more oil to make up for the losses they suffer. Once the money is lost, its gone forever.

 

[myo539]

gee!, good gracious! you can not even see a pun? are you that dense? who doesn't know you can withdraw at 55 & keep it with my 'mother' (CPF) until I am 65 & my 'mother', will slowly pay me...

who doesn't know the government ... I don't, we don't, we must be a numbskull...

In that case, it's better to shut your mouth and look like a fool than to open your mouth to confirm that you are a fool.

Not even a fool thinks it's pun-ny! When confronted with the truth, you back pedalled and feigned your falsehood was a pun. If you think you can act like a seasoned opposition politician - you are a long way off - still very amateurish, cheap skate, juvenile, dumb-wit.

I'm amazed that you get so many green stickers. You must have conned a lot of gullible people with your "puns".

 

[laksaboy]

In that case, it's better to shut your mouth and look like a fool than to open your mouth to confirm that you are a fool.

Not even a fool thinks it's pun-ny! When confronted with the truth, you back pedalled and feigned your falsehood was a pun. If you think you can act like a seasoned opposition politician - you are a long way off - still very amateurish, cheap skate, juvenile, dumb-wit.

I'm amazed that you get so many green stickers. You must have conned a lot of gullible people with your "puns".

Right on cue, the ad hominem attacks from the pro-PAP shill.

 

[myo539]

Right on cue, the ad hominem attacks from the pro-PAP shill.

Right on cue too - anybody with a moustache and you'll call him "papa"!

 

[Papsmearer]

Singapore fund is $1.5 bln bidder for Paulson hotel group




NEW YORK | Mon Aug 20, 2012 11:22am EDT


NEW YORK Aug 20 (Reuters) - The Government of Singapore Investment Corp has bid $1.5 billion for a group of bankrupt hotels owned by hedge fund Paulson & Co, including the Arizona Biltmore Resort & Spa in Phoenix and La Quinta Resort & Club in La Quinta, California.

The MSR Resort hotel group, which also includes Grand Wailea Resorts Hotel & Spa in Hawaii and the Claremont Resort & Spa in Berkeley, California, said it had chosen GIC as the 'stalking horse' or low bidder for the hotels, after looking for an initial bidder since May.

It said it had also spoken with possible equity investors for a reorganization of the hotels before deciding on the GIC offer.

GIC is a sovereign wealth fund that manages Singapore's foreign reserves and is a large real estate investor in the United States. It is a lender to the hotel group and had already made an offer for the group shortly after the bankruptcy filing. It offered $1.5 billion in cash and debt but the resort group rebuffed it, saying it would try to do better for creditors.

Paulson bought the hotels from Morgan Stanley in 2011 and put them into bankruptcy a month later, saying it planned to reorganize them. It already sold one of the hotels, the Doral Golf Resort & Spa in Miami, Florida, to Donald Trump.

Morgan Stanley Real Estate, part of Morgan Stanley, had purchased the five hotels and three others in 2007 for about $4 billion. The hotels filed with $2.2 billion in assets and $1.9 billion in debt.
The $1.5 billion includes up to $1.12 billion in cash and paying off up to $360 million in debt-related claims, according to court documents.

The fund has arranged for a $28 million break-up fee if the hotel group selects another bidder during a bankruptcy auction that it hopes to hold on Oct. 25. A hearing in which the judge will consider the stalking horse bid and sales process is scheduled for Sept. 10.
The case is in Re: MSR Resort Golf Course, U.S. Bankruptcy Court, District of Delaware, No. 11-10372.

This case is actually really bad. It has the potential for at least a USD$500 million loss for GIC. This should have raised many red flags for the opposition and for the people of singapore.

1) Firstly, why is GIC even lending money out as Mezzanine debt? That's crazy, mezzanine financing is subordinated to senior debt. So in this case when the companies are in bankruptcy, its even more risky because the judge could decide to use all available funds to pay the creditors first, than the senior debt holders and finally GIC's mezzanine financing. There might be nothing left to pay GIC back. Considering that GIC is supposed to be holding the country's rainy day fund, why are they investing it in such risky loans. capital preservation should be the overiding concern when it comes to GIC's money, and not the home run big interest rate return.

2) Did GIC even know that Paulson was going to take the hotels into receiverhip? It seems to me that GIC got played out big time here. Paulson went to GIC to borrow $360 million to buy the group of 8 hotels from Morgan Stanley Real Estate (MSRE), and than after buying them, they immediately put the properties into bankruptcy protection. I mean what lender would loan money to a company to suddenly see it going to Chapter 11 bankruptcy proceedings? Looks to me like they got snookered big time. Maybe some one more familiar with the deal can explain it better, but it looks like they were taken for a ride.

3) After throwing in $360 million, they are now throwing in another $1.5 billion. This is more good money chasing bad money. I would have written off the $360 million they loan Paulson to buy the hotels. why bother to buy the rest? These properties are in all the most depressed real estate markets in the US, namely Arizona and California. Good luck waiting for the real estate market there to turn around and make GIC some capital gains. Its not going to happen for a long time.

4) Earlier this year, as the article mentioned, Donald Trump bought one of the hotels from the Paulson group, namely, the Doral golf resort in miami. What the article does not mention is that Trump paid only $150 million for the hotel (which is arguably one of the crown jewel of the 8 hotels, along with the Waimea property). But he has to spend another $200 million to bring this hotel up to PGA standard and 5 star quality. All in, he will spend $350 million on just this one property. SO, basically, GIC is spending $1.5 billion to buy the remaining 7 properties, averaging over $200 million each. And some, especially the Arizona property is probably not worth more than $100 million. Hence a classic case of overpaying. If Trump can pay only $150 million for the choice property among the 8, why is GIC paying over $200 million each for the remaining 7.

5) GIC will argue that really, its only $1.140 billion that they are paying, as they are using part of the $1.5 billion to pay themselves back the $360 million that they loaned to Paulson. But whatever, its still $1.5 billion in total funds committed. These hotels are all bleeding red ink worse than a stuckered pig, with total revenues of of over $400 million per year, I doubt if they are any where near profitable. I don't see how GIC can recoup this investment. The market is just not there right now due to the poor US economy. And if they wanted to attract the well heeled clients, they need to spend hundreds of millions if not another $1 billion like Trump did to renovate their hotels. GIC would have to wait forever to see any capital gains and in the meantime, will be losing money on these hotels.

Than again, maybe the PAP is counting on using these hotels for golfing junkets for the elites, so who cares whether they cost the taxpayer money or not. By the way, these are just my own analysis of this GIC buy. If anyone else has other insights, feel free to add on.

 

[Narong Wongwan]

What's the business term for undertable?

 

[eatshitndie]

What's the business term for undertable?

unorthodox.

 

[Cruxx]

Right on cue, the ad hominem attacks from the pro-PAP shill.

He seems rattled methinks. I would be the same too if I ran out of arguments.

 

[cocobobo]

Temasek Holding and GIC must do a re-think in their investment strategy. They - and some wealthy Singaporean investors included - seem to have a tendency to play the white knights out to salvage a floundering company. They gather that they can do better than what the established company cannot do.

That's probably wishful thinking - no matter how heroic it may seem. You may pay the highest salary to the CEO to front the floundering company - usually an angmoh - but we need to ask what can GIC or Temasek can do that the established company cannot do? These companies probably too have paid not one - but often several succeeding CEOs to the rescue. It's only when they have failed - and realise the hopelessness of the situation - that they finally filed for bankcruptcy. It feels good - gives you a sense of euphoria - that the new owner can transform a bankrupt company to a promising one with high potential. It could be wishful thinking.

Temasek must factor in that they must still operate under the same environment and same rules in that country - no government is going to change for Temasek sake (or they may change rules against Temasek in the case of Indon). Other countries don't operate like Singapore where Temasek aka the Government owns and operate countless commercial enterprises. There are several examples to show sky-high salary foreign CEOs are not working all the times - or even at all. Well, some feel it's part and parcel of doing business - taking "calculated risk". I thought the Singaporeans who tried to "rescue" indebted Manchester United FC or Ranger FC (may be even F1) look like fools. They did not succeed - a blessing in disguise actually - it saves them a lot of money actually - it gives them good publicity though.

That's how I feel as an ordinary man in the street. The day we can have a Ho Kwon Ping who turned a toxic abandoned tin-mine in Thailand into a 6-star golden resort is over, I think. Yes, Ho may have made a bad business decision that nearly bankcrupted Wah Chang, but he operates in a family-own enterprise - not a public-funded organisation. That's a big difference. http://infopedia.nl.sg/articles/SIP_434_2005-01-14.html
There are many thousands of Ho Kwon Pings out there who think likewise and are smelling and lurking like sharks ready for the frenzy. "Ignorant" Singaporeans may not be ready for it - unlike Hong Kongers or Taiwanese - one is "shameless" and the other "ruthless" - LKY's wise words sounding more ominous now.

Finally, Temaske or GIC may NOT have "the capacity to unshackle these businesses" (Quote from DBS CEO Gupta announcing a hefty price for Indon Bank Danamon shares)

dont worry they have the brains and means to turn businesses around

(but usually from black to red )