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Temasek sells Barclays stake at a loss… again

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Less than a month after news broke that Temasek incurred losses of up to S$4.6 bn by selling its BoA stake too early, Temasek is yet again in the news for very similar reasons:

WSJ:

SINGAPORE — Singapore’s Temasek Holdings Pte. has sold its entire stake in Barclays PLC, booking a loss of around $850 million from the investment, people familiar with the situation said Wednesday.

Temasek sold the stake of about 2% mostly in December and January, the people told Dow Jones Newswires.

Temasek’s loss is in contrast to gains another Barclays investor will make from selling part of his stake in the U.K. bank.

On Monday, Sheik Mansour Bin Zayed Al Nahyan, a member of Abu Dhabi’s royal family, announced plans to sell 1.3 billion Barclays shares, resulting in a gain of £1.5 billion from the original investment of about £2 billion.

FT:

Temasek Holdings, the Singapore state investment company, sold its entire stake of nearly 2 per cent in Barclays at the beginning of 2009 at a significant loss, according to people familiar with the matter.

A Reuters report estimated Temasek’s losses much higher at 800 milion pounds, which translates to about S$2.4 bn by today’s GBP-SGD conversion rae.

Well, I suppose Temasek apologists might be heartened to know that Temasek lost less in Barclays than it did in BoA. That’s clear evidence Temasek Holdings is improving, isn’t it?

Of course the lame defense that “other SWFs lost money as well” doesn’t hold up anymore when Abu Dhabi made a profit of 1.5 bn pounds (!!!) by recently anouncing its plan to sell it’s Barclays stake.  Wow.  Two SWFs, both bought into Barclays during a distress period last year.  Look at the great disparity in losses/gains.

Ironically, Temasek would have done much better if it had taken its own advice of investing for the long-term instead of engaging in fire sales.

Apparently, even adjusting for its flaws as an SWF, Temasek clearly isn’t one of the best there is out there, to put it mildly.

Written by defennder

June 4, 2009 at 12:21 AM

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