Singapore's Temasek Gears Up for More U.S. Deals

(Bloomberg) -- Singapore’s $200 billion state investor is gearing up for more deals in the U.S.

Temasek Holdings Pte says it’s “underrepresented” in the world’s biggest economy with about 15 percent of its holdings in that market, and is “comfortable” increasing that to more than a fifth, according to John Vaske, Temasek’s head of Americas.

“From a broad investor mindset perspective, we want to have more representation in the U.S.,” Vaske said in a Bloomberg Television interview on the sidelines on the Milken Institute global conference in Beverly Hills, California. “We see plenty of opportunities each and every week. We see that trend continuing.”

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The approach to the U.S. will follow the sectors and themes that drive Temasek’s investment strategy -- telecommunications, media, technology, life sciences, agriculture, tech-enabled consumer businesses and financial services, he said. Its biggest U.S. holdings -- based on filings -- include Dell Technologies Inc., PayPal Holdings Inc. and Gilead Sciences Inc.

‘Disruptive Change’

“Anything where technology is driving disruptive change or evolution is definitively something we want to be part of as an organization,” he said, declining to say how quickly the state-owned investment firm will scale up its holdings in the country.

Temasek, which was founded in 1974, had S$308 billion ($226 billion) in assets under management as of March 2018, based on the latest figures provided by the company. The firm has delivered a compounded annualized total shareholder return since inception of 15 percent, in Singapore dollar terms. China now accounts for about a quarter of Temasek’s holdings, while Singapore is slightly ahead as its biggest investment destination.

Still, Temasek will be buying more at a time when the U.S. government is increasing its scrutiny of foreign investments into the country. Vaske says that hasn’t affected Temasek, which has offices in New York and San Francisco.

“No one that we talked to as part of that process thought that Singapore, generally speaking, or Temasek, specifically, was a bad actor,” he said. “In fact, they want our investment dollars coming to this market, so I think they will work with us constructively.”

Late Cycle

The company is also cognizant it will be acquiring more following a long run of economic expansion in the U.S., where stocks also rose above their record high at the start of the week -- even after the International Monetary Fund cut its outlook for global growth to the lowest since the financial crisis a decade ago earlier this month.

“It’s obviously late in the cycle,” Vaske said. “So from an underwriting perspective, we want to make sure that we contemplate some form of recessionary environment during the period of time under which we will probably own the investment. But it’s not something we’re obsessed with per se.”

Vaske joined Temasek in January 2017 after almost three decades at Goldman Sachs Group Inc.

--With assistance from Ed Ludlow.

To contact the reporter on this story: Haslinda Amin in Singapore at hamin1@bloomberg.net

To contact the editors responsible for this story: Katrina Nicholas at knicholas2@bloomberg.net, Linus Chua, Peter Vercoe

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