Singaporean companies CapitaLand and Temasek recently reached an agreement to the tune of $6 billion SGD ($4.4 billion). Included in this deal are significant properties belonging to the logistics and industrial arm of state investor Temasek, according to Reuters. It was reported that this would create an investment manager that will be the largest in Asia, to date.
CapitaLand will receive the many assets of Ascendas-Singbridge Group, which includes Ascendas Hospitality Trust, Ascendas India Trust, and Ascendas Real Estate Investment Trust. In turn, Temasek will gain a 51 percent increase in stake in CapitaLand upon conclusion of the deal, from about 40.8 percent before the deal.
This was a direction toward where new chief Lee Chee Koon wanted to guide the company. His vision was to re-create CapitaLand into a company where diversification of the portfolio is a priority. In his vision, mixing up properties and not focusing on just one type of asset plays a big role.
Bloomberg reported the 43-year-old took the job in September and immediately steered CapitaLand into looking at assets in Europe and the US. The latest transaction brings the collection of assets under management to $100 billion, well on target for 2020. The company has also effectively managed to create an environment where it need not worry when parts of the real estate industry undergo a period of stagnation--even decline--with its diverse assets.
Lee has been tasked with bringing about a buffer of sorts for CapitaLand's real estate. With the Asian property market in decline, he is currently steering the company toward becoming better positioned to buckle up the trend of Asian property markets soaring, with the acquisition of Temasek's diverse assets.
Lee has also bee saying how CapitaLand will be moving into a new phase of development, in line with his vision for the company. It had been slowly branching out from Singapore into other parts of Asia, particularly the Southeastern region and China as well. Temasek was just the tip of the iceberg for him, although it was one that he had been eyeing for six months now.
Lee described the third phase of the company as 'global ambition,' saying that other asset acquisitions will follow after the Temasek deal. Markets from other parts of the globe are up for grabs; the portfolio will diversify into different classes, and it will all end up with the goal of the company becoming a truly global player in the world real estate market.
