Singapore’s wealth funds head to Europe for M&As

Are taking advantage of Europe’s financial woes.

Temasek Holdings and GIC Private, Ltd, Singapore’s two government wealth funds, are increasing their activity in Europe due to rising opportunities presented by the region’s economic problems.

GIC last month took a 28.5% in Rothesay Life, a British company that insures UK companies against the expense and volatility of their defined benefit pension plans. It also raised its stake in Royal Mail, the UK postal group, to over 4%.

British media reported that GIC was in talks to buy half of Broadgate, a large office and retail complex in London, in what would be one of the biggest UK property deals since the financial crisis of 2008.GIC manages US$100 billion of Singapore’s foreign reserves.

On the other hand, Temasek last September bought a less than 1% stake in Lloyds Banking Group as part of the first tranche of the UK government’s sale of its £20 billion stake. It manages a portfolio valued at US$172 billion.

Temasek has said that European deleveraging now presented some interesting opportunities after backing out of Europe in 2009 and returning only this year. It has since taken a 5% stake in Spanish oil group Repsol to bring its total stake to 6% and a 4.6% stake in Evonik, a German specialty chemical company.