Singapore’s Temasek eyes wealthy family businesses in S$25b Europe push
Temasek Holdings plans to ramp up investment in Europe, undeterred by setbacks in a region that its new local chief expects will provide significant opportunities for the Singapore state investor.
The firm sought to make net investments of as much as S$25 billion (HK$145 billion) in Europe over the next five years, said Nagi Hamiyeh, head of Europe, Middle East and Africa at Temasek. He is looking for partnerships with companies including those tied to some of the world’s wealthiest business families.
“Europe is in a better place than it was a year or two ago,” Hamiyeh said in an interview before the opening of Temasek’s Paris office. “I volunteered to come to Europe because I see a lot of potential for us to play.”
The targeted investment increase would represent a substantial boost in European assets held by Temasek, which had ¤32 billion (HK$270 billion) in exposure to the region as of March last year, he said.
Hamiyeh’s commitments come at a challenging time for Temasek’s European holdings. Its investments in Standard Chartered and Dutch payments platform Adyen are down from their peaks, while shares of Bayer plunged by 51 per cent in the year to March 31 as the healthcare and agriculture firm faces lawsuits over a weedkiller brand.
Hamiyeh said Temasek would not be able to single-handedly fix the troubles at some of its European investments. Instead, it has held constructive dialogue and provided ideas alongside other investors.
“Are we going to become an activist investor? Absolutely not – it’s not in our DNA,” he said. “Our style, especially outside of Singapore, is to do a lot behind the scenes.”
Temasek managed S$382 billion as of March last year. The broader Europe, Middle East and Africa region represented 12 per cent of its total assets.
Having climbed the ranks of the state-owned investor to become one of its most senior executives, Hamiyeh previously headed the portfolio development group as a troubleshooter who helped promote the consolidation of several of Temasek’s domestic subsidiaries. He now plans to be based in Paris after living in Singapore for 28 years, and will also lead the firm’s energy-related investments.
The shift towards Europe comes at a critical time for Temasek, which celebrates its 50th birthday this year. Its profits form a major source of revenue for the government’s national budget and an election is set to be held as early as this year.
Assets in China, which made up 22 per cent of its assets under management in March 2023, have suffered from falling consumption and valuations. And while 21 per cent of its portfolio is in the Americas, where stock rallies have helped drive up many sovereign funds, more than half of its total holdings are in unlisted assets.
For Hamiyeh, ramping up deals in Europe is necessary to make Temasek’s returns more resilient in an era of geopolitical tensions, high interest rates and inflation. The region combines large conglomerates with strong cash flows and competitive advantages with large domestic consumer bases to provide a hedge against turbulence elsewhere.