|
Singapore: Temasek Holdings, the Singapore state investment company, is considering expanding investments in energy and resources after admitting that it may have been slow in recognising the sector's growth potential.
"We hope to pay a little more attention to that. The oil and gas market is huge and there are lots of different ways to play it, such as with utilities," said Martin Dee, new head of Temasek's international division.
Dee joined Temasek this month after heading investment banking for Morgan Stanley in Houston, the US energy capital.
"When I came here I said where is the oil and gas?" Dee told the Financial Times, referring to the fact that the natural resources sector made up only five per cent of Temasek's Singapore $185 billion ($130 billion) portfolio last year.
Temasek is cautious, however, about making investments in the oil and gas sector when valuations have increased in the past year and it might prefer other options such as alternative energy.
Cheap oil
"There is little doubt that the era of cheap oil is at its end," said Dee, who was Morgan Stanley's regional chief executive for south-east Asia before moving to Houston.
Temasek has focused on industries it has identified as growth sectors benefiting from the rise of a strong middle class in emerging markets.
Financials now account for 40 per cent of its portfolio, followed by telecoms and media at 24 per cent and transport and logistics at 10 per cent.
The new international division that Dee is heading plans to set up more offices in emerging markets, including Latin America, which is becoming a leading commodities producer. It already has branches in China, India and Vietnam.
"Putting people on the ground in such places as São Paulo is more valuable for us in spotting opportunities than having someone in New York, which is more of a known quantity," he said.
Temasek made more net investments outside Asia for the first time last year, including high-profile ones in Merrill Lynch and Barclays.
The move to buy stakes in western financial groups was partly driven by the fact that valuations for Asian banks had become too expensive, while Dee believes western banks represent "turnround champions" at affordable prices.
"There have been a lot of people who have approached us, but we felt that Merrill and Barclays offered the strongest potential. We believe that their management and franchise will give good returns in the long-term," said Manish Kejriwal, the head of Temasek's international investments.
- Financial Times
|
