Robin bears his breast

I've lived in Singapore for 15 years.

I guess that means you must have moved here when you were about two then!! I've been here since February 2000 and before that was based in Paris working on European privatisations.

Companies here that were previously government departments and statutory boards nearly always had audited accounts and benchmarked themselves against international players. But what has been happening once the government starting putting a corporate veil over these companies and bringing in a new set of consultants such as ourselves was that new benchmarks would be created. SingTel, for example, is a very efficient urban telco, but at one point was benchmarking itself against rural telcos which lose a lot of efficiency through running much larger networks.

More a case of fine tuning. In other cases government-owned companies not at the top of the league tables. In Singapore very proud of efficient use of resources.

Other sensitive area. Getting grass roots behind them. Only labour demonstration I've ever seen in Singapore during my 15 years here was a group of Malaysian outriders protesting about their terms of work. There are a lot of mechanisms here to let people get their voices heard. It's often surprising how loud the little guy can be.

Decommissioning part. Move out pension funds into CPF. Move from one fund to another. Not all countries always have a protected system that can be moved into.

Hidden value in public sector here. One example of SingTel's overinvestment ? had fibre optic cables linking all houses estates. Mindset worked hard provide the best in Singapore. As they become corporatised look at other companies the investment community looks at.

Two steps. Intra domestic competition. Airport passenger and cargo. PSA is a competitor with Mon Air. Two mass transit operators. Singapore Buses and SMRT. Many logistic companies here as well. Telecommunications has gone from being very tightly controlled to a free for all. Qu how much domestic competition to create as companies come off the protection of the state.

Regional phase now. Never an ideological sense do these industries first to rev problems of the past. Singapore Airlines run along commercial lines for a very long time.

The whole privatization of the Gencos second quarter of 2002. Choice of electricity seller. Regulation coming out end of this month or October. I know Singapore Power still in strategic negotiations maintaining structure for size of business. Looking at the OZ model.

When did competition start? Public transport. Lots of bus companies. Nest of industrial disputes in the 1960's.Transisland, SMRT . Unlike HK, if competition introduced more buses than need be.

Study 1985/6. Realisation quite big companies and needed to go to market to compete internationally. Early 1990's. First push global, then when Tiger economies took off, went region and then global again. President of PSA said.

SIA and PSA been very successful. In future SingTel looking at more regional growth. Very comfortable management Had wake-up call.

Give DBS the credit. They started off as a development bank. New individuals brought in. Now Economic Development Board handles equity positions in new investments.

Whole industry changing. Open up to foreign competition. Let foreign banks come in . QFB's get wider licenses and additional QFB's being let in. No 1 disputed ares. Do created integrated ATM network everyone can use. When DBS handles a retail offering, everyone can apply for IPO's via ATM machine. Most efficient processing in the world. No other country where this is possible.

1986 IPO's do work for free because control float. Everyone sent cheques and for four days sat on billions of dollars of applications.

Very very undergeared. Everyone asks whether listed companies need AAA rating. SingTel when manage expectations can come again. If know making an acquisition and gearing up. Price paper so investors get a good deal. Singapore Power lot of potential for more gearing. Depending on industry, probably weak double-A.

One of problems global versus regional exposure. If made an investment prior to 1997, dubious credit quality. Early hands got hammered. Minority stakes and change strategy. Now realization need to take control. PSA strategy very much to take control. China strategy 40% depends on way ports operate in a lot of countries.

Classic model. Statutory board. Cash rich organization. Probably slightly overstaffed. Singapore Power no CFO but a financial director. Finance department invest surplus cash. Kevin Yap.

PSA very interesting case in point. Most organized restructuring of assets. Shareholders equity. Lot of assets taken out S$5 billion in cash in 1997. Then down to $3.2 billion dividend for property porfolio. Strip out cash and certain other assets. Made another very large dividend. First of the GLC's to embrace EVA. Discussion spread from PSA to Temasek. Just the way they are. The chairman got hold of the idea first. Is Stamford trained. Wanted to bring in performance related pay. Incentive for EVA. We senior management increase compensation to add value. Reduce capital Applied for a S$1.6 billion dividend. Borrowed money to pay cash. The rationale for the first bond deal. Establishment members jaws dropped off.

Biggest single change I've perceived. Cash rich Need rainy day money. Need to protect yourselves. Look at your neighbours. We will deploy this more efficiently. PSA could have more gearing because it's a fantastic cash cow. Initial aim. Gearing constrained double A.

Interesting thing about the property portfolio. 43% of assets deployed, but 7% of pre-tax income. Had enormous portfolio, development properties. Got involved in national service tasks. Should it be involved in baggage handling, although hub related logistics. Moving people and baggage.

Geared up twice to go to market. Since then PSA property comes out and made a very strategic investment in Northern Europe for about Eu680m. Much smaller than PSA, but still the largest port acquisition they've ever done. PSA is exclusively a container port. PSA is a transshipment hub, but Antwerp is also OND cargo coming into Europe.

There is no comparable to PSA. Hutchison is a conglomerate. P&O. It will become the benchmark.

What has happened in the markets was inconceivable at the time the deal was pushed back. Needs to see what the business looks like steady state. Non-one forecast downturn in global trade. First half as bad as it gests. Box volume good indicator of regional economic activity. First half loss of Maersk.

Keen to be privatized. Very very linked to global trade

It is a possibility that Singapore Power will come first. Less dependent on the global economy. PowerNet good acquisition. PSA and Sing Power both very large entities in the economy.

Not exactly a government that wants to sell. Not a government that needs money Set SMRT a benchmark. Price at top of range, but traded in a very narrow range after listing. Institutions long the stock. Uncomfortable wih pricing level of SingTel and needed ret in

Next year one or two companies privatisation. Government very sophisticated approach to privatisation. Very very focused on how stock market benefit from additional large cap companies. Singtel very small freeflat and crippled Singtel. In SMRT key was the huge percentag government sell-down.

The speech a little bit of a mystery. With Singtel straight credit to buy shares put into CPF. Those who used own money to buy SingTel disappointed. Still trading below IPO price. Actually look at size of the European privatisation programnme. bonus shares, loyalty shares. Get large retail following if offer more stock.

MSCI weighting. Because very large government stake, SinTel underweighted even after dilution through Optus. If able through new share scheme to enhance the float. Through some kind of own fund structure. Would be very helpful.

MSCI implications. Encourage more liqudity and boost to stock market. Lot of Singaporean companies don't have large free flotas and been pulled out of index. Aware of that.

Two fundamental truths. Have to start with float. Secondary offering extremely difficult. Investors worried about overhang and trade down beforehand. Mantra sell as much upfront as possible. Not even decided what percentage. Will depend on market conditions. Our recommendation 40% 2000. Market conditions different then. Still had property portfolio and Maersk.

Key for government. Don't know where invest tomorrow. Don hold onto large hen cc fund tomorrow industries. Have .If other people like to hold stocks. Very very forward looking government in that respect.

Offer more int he IPO. Try to encourage large retail following using discounts loyalty sahres. Incentivise management and employees.

First IPO from government since SingTel in 1993. Lot of people said it would fail . We said just watch us.

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