Saturday, April 7, 2007

Temasek Holdings and GIC: A short profile of Singapore government investment firms

For those who have read my previous post on (Temasek + GIC) vs. RBI tug-of-war, here is some info on the Singapore government's two investment firms - Temasek Holdings and GIC.

Temasek Holdings

Mandate: After independence, the Singapore Government established Government Linked Companies (GLC's) to kick-start investments and growth in key industries. The aim was to setup companies that would put Singapore on the map as a leader in many emerging and important industry sectors; but which needed significant capital which could not be provided by individual entrepreneurs. E.g.: Singapore Airlines, Singapore Technologies, Chartered Semiconductor, Ports of Singapore Authority, Neptune Orient Lines, Singapore Mass Rapid Transit, DBS Bank etc etc.

Initially most of these investments were controlled by the Ministry of Finance (MoF). Temasek Holdings was setup to take charge of investments in many key GLC's. The original mandate was to continue to invest in local Singapore companies to provide them the capital to compete more effectively and develop key technologies on the global stage. Over the years, Temasek Holdings has also invested its returns in external companies and markets to improve returns.


Portfolio size:
US$ 80 billion

Average return:
18% compounded annually over 32 years

India direct investments:

ICICI OneSource (BPO)
Mahindra & Mahindra
Bajaj Auto
Apollo Hospitals
Tata Teleservices
Reliance Energy
Shringar Cinemas

India fund investments:
Merlion Fund
WestBridge Capital Partners
Reliance India Power fund

Useful Links:

Temasek Holdings 2006 Annual Review
On The Prowl - Profile of India approach by BusinessWorld India
Profile of India approach by Asia Times

Government Investment Corporation

Mandate: To preserve the international purchasing power of the Singapore government's foreign exchange reserves.

Established: 1981

Portfolio size:
US$ 100 billion

Average return: 9.5% compounded annually over 25 years

India direct investments:
Matrix Laboratories
Punjab Tractors
Ambuja Cement

India fund investments:
Actis Private Equity Fund

Useful Links:
GIC India investment profile - BusinessWorld India
GIC investment returns - Asia Finance blog
Singapore: The red dot and the dancing elephant -
BusinessWorld India

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