Temasek performs active rebalancing of its portfolio

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Temasek performs active rebalancing of its portfolio

By: 
Chan Chao Peh
21/01/19, 08:00 am

SINGAPORE (Jan 21): The sale of Ascendas-Singbridge’s subsidiaries to CapitaLand is only one in the latest string of deals that Temasek Holdings has been making. Temasek, with more than $300 billion worth of assets in its portfolio, is invested in myriad ventures worldwide. It has typically been investing in public equities, but has since ramped up its interests in privately held ventures and start-ups riding long-term growth trends in healthcare and technology.

Since 2011, Temasek has increasingly focused on the technology, life sciences, agribusiness, non-bank financial services and consumer sectors. Investments include Impossible Foods, the San Francisco start-up that produces a plant-based burger that apparently looks and tastes convincingly like a regular beef burger. For FY ended March 31, 2018, Temasek invested $13 billion in these sectors, nearly half the $29 billion in total new investments made during the FY. According to Temasek in its 2018 annual review, its investment decisions were guided by four overarching themes: transforming economies; growing middle-income populations; deepening comparative advantages; and so-called emerging champions. The past few months have been testament to that.

On Jan 15, Ascent Capital Partners launched a Myanmar-focused private equity fund backed by Temasek and the Asian Development Bank. Thus far, the Ascent Myanmar Growth Fund I has already raised more than US$50 million ($67.8 million) and is looking to bring that up to US$100 million to capture growth arising from Myanmar’s newly opened economy, with fast-growing sectors such as education, consumer, financial services and healthcare.

In November, Temasek raised its stake in Switzerland-based pharmaceutical company AC Immune to 3.9 million shares, following the purchase of 1.28 million shares for US$11.4 million. Temasek, which first invested in AC Immune in 2016, now owns 3.9% of the company. Earlier, on Nov 5, Temasek bought a “minority stake” in Aerogen, an Ireland-based maker of aerosol drug delivery products. Terms of the deal were not disclosed.

In October, Temasek reportedly bought over Sygnia, an Israeli cybersecurity company. As typical of many Israeli high-technology firms, Sygnia is said to be manned by many former members of the famous Unit 8200, an intelligence unit of the Israel Defense Forces.

A few months earlier, in August, Temasek was part of a US$85 million fundraising round by ClassPass, a US-based fitness start-up that gives customers access to fitness facilities. Earlier this month, ClassPass announced that it had acquired GuavaPass, an Asia-based player with the same business model. With this acquisition, ClassPass will be operating in more than 80 market across 11 countries.

Other investments include Verily Life Sciences, the medical unit of Google’s parent company Alphabet, which raised US$800 million in early 2017 from investors, including Temasek. On Jan 3, Verily scored another US$1 billion from a group of investors, including private equity firm Silver Lake and the Ontario Teachers’ Pension Plan, to continue its bid to combat big life-sciences and biology problems such as the Zika virus.

Temasek is also divesting its stakes, which have averaged $18 billion annually over the last five years.

On Jan 8, Bloomberg reported that Temasek was mulling “options” for its 25% stake in retailer AS Watson Group, which runs more than 14,500 stores in 24 markets. Temasek paid CK Hutchison HK$44 billion for the stake in 2014, on the expectation of an IPO, which does not seem to be happening anytime soon. CK Hutchison, part of recently retired Hong Kong tycoon Li Ka-shing’s sprawling empire, holds the remaining stake in the retailer, which accounted for nearly 40% of CK Hutchison’s revenue of HK$224.5 billion ($38.8 billion) for the six months ended June 30, 2018.

On Dec 21, Mapletree Investments, Temasek’s privately held real estate unit, sold a mixed-use office and retail project, the VivoCity Shanghai, to Blackstone Group for US$1.2 billion. Mapletree has a total of $46.3 billion worth of assets under management.

On Oct 24, ACR Capital Holdings, a Singapore reinsurer, was reportedly put up for sale by its shareholders, including Temasek and Malaysia’s Khazanah Nasional, with a price tag of some US$800 million.

Meanwhile, Ascendas-Singbridge was said to be mulling a US$500 million listing of its US office assets last November. Just two months before that, it bought a portfolio of 33 office properties in the US with a net lettable area of 3.3 million sq ft in San Diego, Portland and Raleigh.