We continued to actively invest in opportunities around the world, while stepping up our divestment pace.
During the financial year ended 31 March 2016, we invested S$30 billion and divested S$28 billion. We capitalised on the liquidity-driven market rally seen in the earlier part of the financial year to step up our divestment pace, resulting in a lower net investment amount, of S$2 billion, relative to the past few years.
Temasek also plays an enabler role across all stages of enterprise, from startups to later stage companies, seeking out those with disruptive business models that are potential game changers and transforming existing businesses. Our direct investing activities are complemented by the Private Equity Fund Investment team, which develops our network of relationships and extends our reach.
We identify and nurture enterprises that are potential leaders in their industry with a focus on innovation to drive success and make a difference.
In the financial services space, we continued to expand into non-banking sub-sectors including an investment in PayPal, a digital payment service provider operating in more than 200 markets worldwide.
We have also been actively investing in smaller but fast-growing technology-enabled companies, such as SoFi and C2FO in the US, Funding Circle in the UK, and BillDesk and Policy Bazaar in India. Within the investment brokerage space, we invested about HK$2 billion in CITIC Securities, a full-service securities firm in China.
In line with our theme of investing in companies with distinct competitive advantages, we invested in Airbnb, a global marketplace for travel accommodation in 190 countries worldwide. We also increased our investment in Didi Chuxing, a Chinese transportation network company; and Meituan-Dianping, an online-to-offline local service platform in China. In October 2015, we committed to funding Dell’s merger with EMC, which, when completed, will result in one of the world’s top technology vendors.
In life sciences & agriculture, we invested US$300 million in the management buyout of China-based WuXi PharmaTech, a global provider of laboratory and manufacturing services to biopharma and medical device companies. We also invested in Alvogen, an international generics pharmaceuticals company. And we increased our investment in COFCO International Limited, a holding company which owns the controlling stakes in international supply chain managers Nidera and Noble Agri, in conjunction with its buyout of the remaining Noble Agri minority stake.
The US accounted for the largest share of new investments during the year, reflecting our view of the recovering economic environment and sourcing from networks that we have steadily built there.
In the US, we increased our position in the logistics sector via a US$450 million investment in Univar, a distributor of commodity and specialty chemicals. We also continued our investment in the biotechnology space through investments in Alexion and Regeneron, companies that develop transformative treatments for serious diseases.
We also continued to make new investments in Asia, of which China accounted for the largest share. In addition to the investments in China mentioned earlier, we also invested in Zhongce Rubber, a domestic tyre manufacturer; and in Cainiao, a data and technology-based logistics platform focused on e-commerce. In financial services, we increased our stake in Industrial and Commercial Bank of China, and invested in Postal Savings Bank of China, a provider of financial services to rural, small-to-medium enterprises, and retail banking segments.
Apart from China, we increased our investments in the consumer sector in South Korea by investing in Homeplus, a domestic hypermarket operator with 140 stores. In India, we invested in Glenmark Pharmaceuticals, a global manufacturer and distributor of branded and generic pharmaceuticals; ICICI Prudential, a life insurance company; and CarTrade, an online auto classifieds company.
In Europe, we made a CHF600 million investment in Switzerland-based airport retail operator, Dufry AG, to help finance its merger with World Duty Free to create one of the largest travel retailers worldwide. We also continued our investments in UK real estate by acquiring a stake in Blue Fin Building, a Grade A property located in South Bank, London.
We invested US$3 billion in the Avanda Global Multi-asset Master Fund. It is managed by Avanda Investment Management, a Singapore-based multi-strategy, global asset manager.
From time to time, we look to reshape and rebalance our portfolio as opportunities arise. Our key divestments during the year included our majority interest in STATS ChipPAC and our positions in Cognizant Technology Solutions, Lloyds Banking Group, and Kweichou Moutai.
As at 31 March 2016, we also divested part of our holdings in China Construction Bank, Gilead Sciences, AIA Group and China Pacific Insurance Group. However, we continue to retain significant exposures in these companies.
Post year end, in June 2016, we tendered our shares in Neptune Orient Lines as part of the Voluntary General Offer made by CMA CGM in December 2015. We also invested an additional US$500 million in Alibaba shares.
Seeding New Businesses
Although requiring long term nurturing, we seed new businesses that are expected to yield sustainable returns over cost of capital. The rejuvenation of Mandai into an integrated wildlife and nature heritage precinct is an example of a project with a long gestation period.
Temasek set up Mandai Safari Park Holdings to further develop concepts for the rejuvenation of Mandai and seek the appropriate approvals for the project, as well as integrate the operations of Singapore’s existing nature-based attractions, under the long-standing ownership of Wildlife Reserves Singapore.
The US accounted for the largest share of new investments during the year.
Investments for the year
Divestments for the year
Temasek as an Enabler of Growth Capital
In July 2015, Temasek partnered UOB to build InnoVen Capital (InnoVen), the first venture debt financing platform for high growth startup companies in India, China, and South East Asia. Before its acquisition by Temasek, InnoVen was previously known as SVB India – at that time, India’s largest provider of venture debt.
Following the Temasek-UOB partnership in 2015, InnoVen has more than doubled its loan volumes in India. In March 2016, InnoVen signed its first financing agreements in South East Asia, with loans totalling US$5 million to Malaysia-based KFit Holdings, an e-commerce health and fitness company; and Thailand-based Pomelo Fashion, an e-commerce fashion company.
Heliconia Capital continued to deploy capital from its SME Co-Investment Fund and SME Growth Mezzanine Fund. New investments during the year included Jumbo Seafood, a Singaporean seafood restaurant chain; Hope Technik, an advanced engineering company; Fagerdala Singapore, an integrated packaging solutions provider; and Futuristic Store Fixtures, a store fixture specialist serving global retail clients.
Temasek also invested in Pierfront Capital, which provides mezzanine financing for projects in the infrastructure, offshore and marine, and transportation and logistics sectors. Pierfront, together with Clifford Capital, offers customers a complete suite of project financing solutions.
Transforming Existing Businesses
Temasek works to transform existing businesses through developing business strategies with management, investing in companies to tap growth potential and providing people support to bridge capabilities gaps.
Surbana Jurong was created in June 2015 from the merger of entities owned by Temasek and JTC Corporation to form an integrated platform for sustainable urban solutions. Surbana Jurong then acquired KTP Consultants and Sino-Sun Architects & Engineers to strengthen its infrastructure development capabilities.
In November, Surbana Jurong bolstered its sustainability and building design capabilities by investing, together with Temasek, in Flux Factory, a spin-off from Google X, which is a developer of cloud-based collaboration tools for urban solutions and master planning.
Ascendas-Singbridge – the other new entity created in this platform – strengthened its urban solutions capabilities by acquiring commercial buildings in Singapore, Australia and South Korea. These acquisitions broaden its business space solutions offering to include Central Business District offices.
As a master developer of larger-scale urbanisation projects, Ascendas-Singbridge works with its partners to drive economic development. For example, the Sino-Singapore Jilin Food Zone, a joint project with the Jilin City government, exported its first product, a brand of japonica rice, to Singapore in December 2015.
We identify and nurture enterprises that are potential leaders in their industry.
We seed new businesses that are expected to yield sustainable returns.