Ever since the announcement of Temasek Holding's bid to increase stakes in Keppel Corporation. There has been numerous comments from among my friends. While those holding some shares in Keppel Corporation are happy with the offer price of $7.35 which most likely they would accept the offer to obtain some profits. Others, the more negative ones tend to look on the bad side of it, even to the point of thinking the Government using tax payer money to save their companies. Well...
Temasek Holdings is a state-owned enterprise that manage a portfolio of investments in several different sectors. Just earlier this year, Temasek together with SPH took over M1 Telecommunication, one of the 3 main telecommunication companies in Singapore. Subsequently M1 was de-listed from SGX. It has been one of my main holdings for many years, and I was kind of sad to let it go. Now they are moving into taking over Keppel. All these moves within a year signal a move toward a game plan of consolidation. But why need for this move?
To understand it further, we need to look into our history. Singapore is a small nation with no natural resources, and our first PM Lee Kuan Yew knew it well that for Singapore to survive, Singapore must venture beyond the border and create itself its own identity and a branding to the world. The investors must be attracted to Singapore to create industry and jobs. Looking through the history, we had done well. Singtel, SPH, Keppel, Sembcorp etc all these are well-known to all
Singaporean and a signature brand of Singapore in the Global world. But that was in the past.
Time is changing, companies must evolved with time to stay competitive. And looking at our government afflicted companies, they are certainly not doing so well as before. Keppel and Sembcorp may be known to the world as Singapore brand but they are peanuts compare to the Global giant of Google and Amazon, and even Alibaba which was well supported by China's own massive domestic market of 1.4 billion population. Where do Singapore stands now among these giants? China is already into the 5G network, are ours Singtel ready for it? Gone are the days of paper news, in this age of social media, how will SPH revamp itself to stay competitive?
In this fast changing age, there is a need for a move to stay competitive. Temasek moves to assume control of companies is just a beginning, more re-structure will come and the new management will need to look beyond the border into the Global world to re-position Singapore. One thing is for sure, it will not be an overnight affairs, new policies will need time to carry out and the results of it whether successful or not will take years to bear fruits. This is the fate of a small nation with no natural resources, either we evolve or we gets left behind.
