In the mood for equity: Temasek's latest ICBC shares were bought on the same day that Goldman Sachs cashed in on its seven-year investment in ICBC, selling 1.58 billion shares for US$1.1 billion. - PHOTO: BLOOMBERG
IT has been a busy week for Singapore investment company Temasek Holdings. So far, it has spent about US$700 million on two purchases - one in London and the other in Hong Kong.
Yesterday, Temasek confirmed that it had made a "significant equity investment" in Markit, a London-based global financial data provider. The much-speculated deal, a 10 per cent stake worth US$500 million according to the
Financial Times, drove Markit's market value to beyond US$5 billion, making it a strong candidate to enter the FTSE-100 if it opted to list on the London Stock Exchange. As at yesterday, Markit told BT, it has not made any decision to pursue a public listing.
Markit was founded by Canadian and former bond trader Lance Uggla - reportedly in a barn at the bottom of his garden in 2003 - as Mark-it Partners to provide daily pricing for credit default swaps (CDS). These tradeable financial instruments allow investors to bet on the likelihood of debt default or hedge against such risks. They have become especially sought after since the start of the US subprime mortgage crisis in 2007. The gross amount of CDS outstanding is estimated to be US$27 trillion, many of which are based and daily valued on prices supplied by Markit.