!! History Commons Alert, Exciting News

Follow Us!

We are planning some big changes! Please follow us to stay updated and be part of our community.

Twitter Facebook

Global Financial and Economic Crises

Purchases of Western Companies by Investors from Asia

Project: Global Financial and Economic Crisis 2007-Present
Open-Content project managed by KJF, mtuck

add event | references

Temasek Holdings, an arm of Singapore’s government, buys a large stake in the troubled US financial services company Merrill Lynch. It pays $48 per share, 13 percent less than the market value, and spends a total of $4.4bn. It also has an option to purchase a further $600m worth of shares by the end of March 2008, but agrees not to sell for a year. The asset manager Davis Selected Holdings also takes a smaller stake in Merrill Lynch. The shares purchased are newly issued, meaning the existing stockholders’ influence is diluted. However, the company needs the extra cash in order to cope with its losses on the subprime mortgage market. [Reuters, 12/25/2007] However, Merrill Lynch will sell more new shares for a lower price a few months later. This activates a clause in the agreement with Temasek saying it is entitled to a discount, totaling around 50 percent on the price of the shares sold in December 2007. Temasek reinvests this discount in additional Merrill Lynch shares (see July 29, 2008). [Agency France-Presse, 9/15/2008]

Entity Tags: Merrill Lynch, Davis Selected Advisers, Temasek Holdings

Category Tags: Western Purchases by Asians, USA

The leading British bank Barclays announces that it will issue new shares worth £4.5bn (about $9bn) to bolster its finances, which have been hit by losses on US mortgage-backed securities. Much of the new money will come from Asian investors, led by the state-run Qatar Investment Authority (QIA). The Qataris will invest £1.7bn (about $3.4bn), taking a 7.7 percent stake. [BBC, 6/25/2008] The QIA’s holding company is chaired by Sheikh Hamad Bin Jassim Bin Jabr Al-Thani, Qatar’s prime minister, who is to invest another £533m (about $1bn) privately through a company named Challenger. [Daily Telegraph, 6/27/2008] The Japanese bank Sumitomo Mitsui will invest £500m (about $1bn) and existing shareholders are also to buy more shares. The China Development Bank will buy another £136m (about $270m) of shares, and the Singaporean investment fund Temasek will buy another £200m (about $390m) of them. [BBC, 6/25/2008]

Entity Tags: Barclays Bank, Qatar Investment Authority, China Development Bank, Temasek Holdings, Sumitomo Mitsui, Hamad Bin Jassim Bin Jabr Al-Thani, Challenger

Category Tags: Western Purchases by Asians, Britain

Temasek, an arm of the government of Singapore, increases its stake in troubled US financial services company Merrill Lynch. It had previously paid $5bn for new shares in the company (see December 25, 2007), but is now entitled to a discount on this totaling $2.5bn. It spends the discount returned to it by Merrill Lynch and an additional $900m on more shares in the company. Temasek pays around $24 per share, half of what it paid in December 2007. [Agency France-Presse, 9/15/2008; Bloomberg, 9/15/2008]

Entity Tags: Merrill Lynch, Temasek Holdings

Category Tags: Western Purchases by Asians, USA

Talks between Lehman Brothers and the Korea Development Bank end. The Koreans had been thinking about investing in the bank, enabling it to raise needed capital. However, they decide not to go through with the investment. [Bloomberg, 9/16/2008] Lehman Brothers files for liquidation five days later (see September 14, 2008).

Entity Tags: Lehman Brothers, Korea Development Bank

Category Tags: Failing Companies, Western Purchases by Asians, USA

Mohammed bin Khalifa al-Thani, a member of the royal family of Qatar, pays $280.4 million for a 5% stake in the Icelandic Kaupthing Bank (see February 22, 2008). The bank’s shares have been falling on Iceland’s stock exchange, down 57% in the last twelve months, and the bank has been buying them back itself in an attempt to boost its stock price. The purchase makes al-Thani the third largest shareholder in the bank. [Forbes, 9/22/2008] Seventeen days later, the bank will be on the verge of collapse and will be seized by the government of Iceland. [Reuters, 10/9/2008]

Entity Tags: Kaupthing Bank, Mohammed bin Khalifa al-Thani

Category Tags: Western Purchases by Asians, Iceland

Temasek Holdings, an arm of the government of Singapore, acquires shares in Bank of America. It does this by converting shares it had purchased in Merrill Lynch (see December 25, 2007 and July 29, 2008) into shares in Bank of America, which had recently purchased Merrill Lynch (see September 14, 2008). Temasek now owns 3.8 percent of Bank of America. [Reuters, 1/11/2009]

Entity Tags: Bank of America, Temasek Holdings

Category Tags: Western Purchases by Asians, USA

Ordering 

Time period


Email Updates

Receive weekly email updates summarizing what contributors have added to the History Commons database

 
Donate

Developing and maintaining this site is very labor intensive. If you find it useful, please give us a hand and donate what you can.
Donate Now

Volunteer

If you would like to help us with this effort, please contact us. We need help with programming (Java, JDO, mysql, and xml), design, networking, and publicity. If you want to contribute information to this site, click the register link at the top of the page, and start contributing.
Contact Us

Creative Commons License Except where otherwise noted, the textual content of each timeline is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike