SINGAPORE, Feb 10, 2010 (AFP) - Singapore's Temasek Holdings on Wednesday announced the creation of a new global investment company, which analysts said will give it more flexibility to expand its portfolio.
Temasek was tight-lipped about the mission or funding of Seatown Holdings, which it said would be a wholly owned subsidiary.
But economists said the new firm would provide Temasek more options as it seeks to spread its investments around the world, while it could also serve as a vehicle for private Singaporean firms and funds to become co-investors.
"It is easier from a standpoint of accountability to set up a separate company which may have a different investment philosophy but is still under the Temasek umbrella," said Song Seng Wun of CIMB-GK Research.
"This will give them flexibility without changing the Temasek charter to accommodate the change," he told AFP.
David Cohen of Action Economics consultancy agreed that having a separate global company would make the company more nimble as it seeks out further investments.
"I assume their main focus will continue to be in the Asian region, an area where they have a natural advantage," Cohen told AFP.
Temasek's latest announcement came two days after it said it was planning a bond offering worth one billion Singapore dollars (704 million US) as part of a capital-raising programme.
The bonds are due in 2020 and will be issued by its wholly-owned subsidiary Temasek Financial as part of a 10 billion US dollar borrowing programme.
By the end of July 2009, Temasek owned a diversified portfolio worth 172 billion Singapore dollars (119 billion US) focussed mainly in Singapore, Asia and emerging economies, according to its website.
Its investments cover financial services, telecommunications and media, transportation and logistics, real estate, infrastructure, industrial and engineering, energy and resources, life sciences, consumer and lifestyle and technology.
Temasek's portfolio includes Singapore Airlines, Standard Chartered bank, Singapore Telecommunications and developer CapitaLand.
Temasek senior managing director and chief strategist Charles Ong was named chief executive of the new company, it said in a statement.
