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<TABLE border=0 cellSpacing=0 cellPadding=0 width=452><TBODY><TR><TD vAlign=top width=452 colSpan=2>Published July 9, 2010
</TD></TR><TR><TD vAlign=top width=452 colSpan=2>SeaTown to be a co-investment test-bed
It could eventually take in institutional and public investors
By LYNETTE KHOO
(SINGAPORE) SeaTown Holdings, a new investment outfit set up by Temasek, will be a test-bed to explore how to allow the Singapore public to co-invest with the investment firm.
<TABLE class=picBoxL cellSpacing=2 width=100 align=left><TBODY><TR><TD>
</TD></TR><TR class=caption><TD>Mr Israel: SeaTown, having its own board and management, will determine its own investment strategies independently from Temasek </TD></TR></TBODY></TABLE>It is taking on a broader mandate to invest across wider geographies and asset classes, going places where Temasek may not set foot on.
SeaTown could also take in institutional co-investors in three to five years' time after at least one market cycle of testing.
In a longer timeframe of eight to 10 years, it may be opened to public investors through bonds or funds, Temasek said yesterday.
Temasek shared the information on its new platform yesterday during its annual report briefing.
SeaTown was set up in February this year with more than $4 billion of committed capital and the agreement for co-investment rights between Temasek and itself.
Temasek executive director Simon Israel said yesterday that Temasek has planned for this set-up three years ago in 2007, when it started mulling the possibility of opening a platform for the Singapore public to co-invest in. 'Last July, Ho Ching also publicly mentioned the possibility of having the public co-invest with Temasek perhaps in eight to 10 years' time. So, SeaTown is a test-bed, if you will, to explore how this can be done in a sensible and sustainable manner,' he said.
Mr Israel also stressed that SeaTown, having its own board and management, will determine its own investment strategies independently from Temasek and reiterated that it is not a hedge fund.
For a start, SeaTown is seeded with experienced secondees from Temasek, headed by Charles Ong as its chief executive officer and Margaret Lui as chief operating officer, 'to propagate the DNA of Temasek in terms of an ownership mindset and a long-term perspective', Mr Israel said.
But it will also be recruiting experienced key personnel from outside Temasek with specific expertise across asset classes.
How SeaTown's investments would affect Temasek's shareholder returns remains unclear.
Wong Sui Jau, general manager of Fundsupermart, cited two possible scenarios. Suppose SeaTown ventures into more diversified assets and geographies, that would lead to lower volatility but also lower returns. 'If it ventures into high beta markets, it will have higher returns but the cost is higher volatility,' he added.
David Cohen, director of Asian Economic Forecasting for Action Economics said that he believes 'it will be a challenge for (Temasek) to continue to outperform as they open additional funds'.
Besides SeaTown, Temasek had earlier established another platform - SingBridge International - to focus on developing and investing in townships and providing large-scale urban solutions in Asia.
Its initial focus is China, where it is involved in the eco-city in Tianjin and the knowledge city in Guangzhou - both are joint investment projects between Singapore and China.
The agreement with Guangzhou Municipality to jointly invest in and develop the Sino-Singapore Guangzhou Knowledge City was inked just last week, where SingBridge expects to invest two billion yuan (S$409 million) for a 50 per cent stake in the joint venture.
Earlier in May, SingBridge also signed a memorandum of understanding with the Jilin Municipal Government to assess the commercial feasibility of jointly developing a 1,450 sq km agricultural and food zone in Jilin City.
</TD></TR></TBODY></TABLE>
</TD></TR><TR><TD vAlign=top width=452 colSpan=2>SeaTown to be a co-investment test-bed
It could eventually take in institutional and public investors
By LYNETTE KHOO
(SINGAPORE) SeaTown Holdings, a new investment outfit set up by Temasek, will be a test-bed to explore how to allow the Singapore public to co-invest with the investment firm.
<TABLE class=picBoxL cellSpacing=2 width=100 align=left><TBODY><TR><TD>
</TD></TR><TR class=caption><TD>Mr Israel: SeaTown, having its own board and management, will determine its own investment strategies independently from Temasek </TD></TR></TBODY></TABLE>It is taking on a broader mandate to invest across wider geographies and asset classes, going places where Temasek may not set foot on.SeaTown could also take in institutional co-investors in three to five years' time after at least one market cycle of testing.
In a longer timeframe of eight to 10 years, it may be opened to public investors through bonds or funds, Temasek said yesterday.
Temasek shared the information on its new platform yesterday during its annual report briefing.
SeaTown was set up in February this year with more than $4 billion of committed capital and the agreement for co-investment rights between Temasek and itself.
Temasek executive director Simon Israel said yesterday that Temasek has planned for this set-up three years ago in 2007, when it started mulling the possibility of opening a platform for the Singapore public to co-invest in. 'Last July, Ho Ching also publicly mentioned the possibility of having the public co-invest with Temasek perhaps in eight to 10 years' time. So, SeaTown is a test-bed, if you will, to explore how this can be done in a sensible and sustainable manner,' he said.
Mr Israel also stressed that SeaTown, having its own board and management, will determine its own investment strategies independently from Temasek and reiterated that it is not a hedge fund.
For a start, SeaTown is seeded with experienced secondees from Temasek, headed by Charles Ong as its chief executive officer and Margaret Lui as chief operating officer, 'to propagate the DNA of Temasek in terms of an ownership mindset and a long-term perspective', Mr Israel said.
But it will also be recruiting experienced key personnel from outside Temasek with specific expertise across asset classes.
How SeaTown's investments would affect Temasek's shareholder returns remains unclear.
Wong Sui Jau, general manager of Fundsupermart, cited two possible scenarios. Suppose SeaTown ventures into more diversified assets and geographies, that would lead to lower volatility but also lower returns. 'If it ventures into high beta markets, it will have higher returns but the cost is higher volatility,' he added.
David Cohen, director of Asian Economic Forecasting for Action Economics said that he believes 'it will be a challenge for (Temasek) to continue to outperform as they open additional funds'.
Besides SeaTown, Temasek had earlier established another platform - SingBridge International - to focus on developing and investing in townships and providing large-scale urban solutions in Asia.
Its initial focus is China, where it is involved in the eco-city in Tianjin and the knowledge city in Guangzhou - both are joint investment projects between Singapore and China.
The agreement with Guangzhou Municipality to jointly invest in and develop the Sino-Singapore Guangzhou Knowledge City was inked just last week, where SingBridge expects to invest two billion yuan (S$409 million) for a 50 per cent stake in the joint venture.
Earlier in May, SingBridge also signed a memorandum of understanding with the Jilin Municipal Government to assess the commercial feasibility of jointly developing a 1,450 sq km agricultural and food zone in Jilin City.
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