Sunday, January 18, 2015


Monday, Jan 19, 2015

SINGAPORE - Mr Goh Cheng Liang, the founder of Nippon Paint South-East Asia Group (Nipsea), is now the richest man in Singapore, Bloomberg reported.

Mr Goh's net worth of US$8.2 billion (S$10.8 billion) fortune far surpasses the previous number one, Mr Wee Cho Yaw, who is the largest shareholder of United Overseas Bank. Mr Wee was listed as the richest Singaporean on Forbes 2014 list with a US$6.9 billion fortune.

Coming in third on the Bloomberg report is Madam Tan Kim Choo, the widow of late property tycoon Ng Teng Fong, with a US$4.9 billion fortune. According to a Forbes report, her sons, property baron brothers Philip and Robert Ng, are estimated to have a combined net worth of US$11.5 billion.

The 87-year-old Mr Goh, who holds a 39 per cent stake in Nipsea, is the largest shareholder in the company. He is co-owners with Osaka-based Nippon Paint Holdings. Bloomberg reported that his stake in the joint venture is kept at this private investment company, Wuthelam Holdings.

With his multi-billion net worth, it is hard to believe that Mr Goh was born into a poor family and took to selling fishing nets and working at a hardware store as a boy.

Singapore's richest man is now paint tycoon Goh Cheng Liang

According to Investvine, Mr Goh traded a song for a stockpile of barrels of rotting paint that the British had auctioned off during Wold War II in 1949. He then mixed the concoction of chemicals that would later become his first brand of paint, Pigeon.

After founding Nippon Paint in Singapore in 1955, business picked up and he eventually managed to set up the firm's first paint manufacturing plant a decade later. The Nippon brand now sells in 16 countries worldwide, with an annual turnover at US$2.6 billion.

According to The Straits Times, Mr Goh had also built up the Wuthelam group by investing in Liang Court shopping complex, hotels, electronics, logistics, manufacturing and trading.

Sunday, December 7, 2014


Widjaja family

Top 10 richest in Indonesia

The latest Forbes Indonesia Rich List reveals that Hartono brothers, Budi and Michael have topped the charts for the sixth year straight.

The Hartono banking tycoons added more than US$1 billion (S$1.3 billion) to their fortune after their Bank Central Asia shares went up 50 per cent last year. To date, they are worth a staggering US$16.5 billion.

In comparison, the Ng brothers from Singapore who top the nation at US$12.8 billion, don't even come close to the Hartonos'.

Not to be outdone, tobacco tycoon Susilo Wonowidjojo made it to the second top spot at US$8 billion, from fourth place last year. The stock price of Wonowidjojo's company Gudang Garam has soared by almost 60 per cent since the previous list and he had accrued US$2.7 billion more since the stock increment.

Head of Salim Group, Anthoni Salim remains the third richest person in Indonesia, with a net worth of US$5.9 billion. The conglomerate chief oversees the group which operates food, telecom, retail, property and banking units. Salim Group is also synonymous with Indofood, the world's largest manufacturer of instant noodles.

Collectively, Indonesia’s 50 richest are worth US$102 billion, up from last year's figure of US$95 billion. Making the list this year was quite a challenge since US$500 million is the minimum net worth to qualify, up from last year's US$390 million.

The increased minimum net worth means that some tycoons from the previous list have been edged out. One notable absentee is Kiki Barki, whose net worth dropped after the stock price of his coal company, Harum Energy, plummeted.

Despite being on the country's richest list, majority of returning qualifiers saw their wealth fall or stagnate. This could be attributed to a declining rupiah and the coal and palm oil industries facing bad times as commodities prices slide.

On the bright side, it is interesting to see new faces with the increase of the minimum net worth. The most well-known figure is owner of Blue Bird taxis, Purnomo Prawiro. The taxi company was listed in November and Prawiro made the Forbes list at number 25 with a net worth of US$1.3 billion.

Joining him on the list are newcomers Husodo Angkosubroto of conglomerate Gunung Sewu Group in the 23rd place with a net worth of US$1.45 billion, and timber baron Abdul Rasyid at number 41 with a net worth of US$805 million. Coming close at the 44th spot is herbal medicine entrepreneur, Irwan Hidayat who is worth US$660 million.

The top 10 richest in Indonesia are:

1) Budi & Michael Hartono; US$16.5 billion

2) Susilo Wonowidjojo; US$8 billion

3) Anthoni Salim; US$5.9 billion

4) Eka Tjipta Widjaja; US$5.8 billion

5) Sri Prakash Lohia; US$4.4 billion

6) Chairul Tanjung; US$4.3 billion

7) Boenjamin Setiawan; US$3.5 billion

8) Mochtar Riady; US$2.7 billion

9) Peter Sondakh; US$2.3 billion

10) Sukanto Tanoto; US$2.11 billion

--Friday, Dec 05, 2014  ASIA ONE

Monday, April 21, 2014

Richard Li

Global Deal Maker

The son of Asia's richest man receives the Jubilee Award from Canada's minister John Baird.

Richard Li builds an Asian insurer

Finance Asia story by Alison Tudor  2014 April 17

FWD Group's new chief executive Huynh Thanh Phong has hit the ground running: forging a pan-Asian insurer out of new ventures across Southeast Asia and a multi-billion-dollar business bought from Dutch bank ING last year — while scouting for more acquisitions.

Huynh is bringing to life a plan drawn up by Hong Kong-based businessman Richard Li, Li Ka-Shing's younger son, to create a pan-Asian player selling insurance to the region’s emerging affluent classes. 

In the most complete picture so far, FinanceAsia maps out FWD’s expansion across the region from Indonesia to Hong Kong and explains why FWD is targeting acquisitions in Vietnam, Singapore and Malaysia.

“It’s not just ambition and money,” said Huynh to FinanceAsia in his first interview since taking up the reins in March.

Now that the business plan has been hashed out, capital is in hand and a management team assembled the next step will be bolt-on acquisitions across Southeast Asia. FWD will have to navigate such pitfalls as soaring company valuations and an evolving regulatory landscape.

For Li this venture marks a return to insurance after he sold Pacific Century Insurance to Fortis in 2007 and a low-risk way of riding the economic growth across emerging Asia. The profitable businesses in Hong Kong and Thailand more than pay for FWD’s expansion.

FWD is betting that the traditional ruling classes in Southeast Asian countries such as the Philippines and Vietnam have accepted the rise of an upwardly mobile middle class and that this increasingly wealthy segment of society will look to protect its improved lifestyle via insurance and rely less on dwindling state support.

But does Asia need another insurer? The comparative data suggests yes. Researchers at Swiss Re estimate that only 2.21% of the population across the Asean region in 2013 owned a life insurance policy compared with 4.91% in industrialised countries.

Improve the image

FWD says it will help rehabilitate the industry’s reputation, which has been marred in recent years by miss-selling scandals. “We want to change the way people feel about insurance — we vowed to do things very differently when we created this brand,” 47-year-old Huynh said.

FWD’s use of technology would make the sales process more compliant and efficient and keep sales documents up-to-date, helping to attract younger-customers.

To do this FWD is leveraging Li’s control of Hong Kong’s dominant fixed-line telecoms company PCCW, although this has to be done delicately because of Hong Kong’s strict rules on data protection and the fact each company has a distinct set of shareholders. 

“The whole of society is moving very fast online and screen-based. How we, as an insurance company, adapt and leverage that technology to sell and support customers is vital,” Huynh said in the interview at FWD’s new headquarters in Hong Kong. The paper slip in the nameplate on his office door underscores the speed of change at the enterprise.

Big Ambitions

The new insurer on the block certainly has big ambitions — FWD is ranked ninth in Hong Kong but wants to be among the top five insurers within five years.

It has the capital to back it up: Li Ka-shing, one of Asia’s richest men, said in 2012 that he would fund his son (pictured below) Richard’s ventures. In addition, Swiss Re,  the world's second largest reinsurer, acquired a 12.3% share in FWD in 2013 for $425 million.

“They don’t think small,” Huynh said of his shareholders. “They certainly have very big ambitions and to back them up they have [the] financial strength and expertise.”

To be sure, there are risks involved with the rosy growth projections of insurance across emerging Asia, a volatile region both economically and politically. This was demonstrated by the recent political turmoil in Thailand which has hit insurance sales across the board.

“The immediate impact was minimal when tensions escalated late last year — but as the situation drags out the average person is hurting economically,” Huynh said, when asked about the effect of the global financial crisis on insurance sales.

Credit rating agency Fitch gave FWD a single-A rating in February, partly reflecting its solvency ratio of 243% as of end 2013, well in excess of the 150% regulatory benchmark. But it did warn that the operating and pricing risks associated with material growth could affect the stability of FWD’s operating results.

Cross-border acquisitions are also harder to pull off and make profitable, particularly if the target is in an emerging market. Consultancy Towers Watson notes that domestic acquisitions generate a higher average return for investors in the acquiring company of 8.3 percentage points above the local MSCI benchmark over the six months post completion of the deal; well above the average return generated in a cross-border deal into emerging markets such as Latin America and Asia, of 4.5 percentage points above the acquiror's domestic MSCI benchmark. 

Globally, insurance deals take a long time to close, 116 days on average versus 70 days for other industries, and in Asia it takes even longer mostly due to a lack of data, a shallower talent pool and weaker financial management, Alan Merton, Asia-Pacific insurance director at Towers Watson, said. 

Li and Huynh face stiff competition from other insurers while scouting for deals in countries such as Malaysia and Vietnam from as far afield as Japan and Canada.

As a result, mergers and acquisitions are becoming more costly. “We’re keen to look at M&A opportunities but we have to be financially disciplined,” said Huynh. “Organic is my preferred mode because I like building companies, but it takes a long time,” he said, while lamenting that new insurance trading licences can be extremely difficult to obtain.

In terms of sales, FWD is targeting relatively younger clients than more established players such as AIA and Prudential. While these clients are less experienced buyers they are also likely to stay with the company longer.

Putting money to work
FWD’s cornerstone is the former ING franchise in Hong Kong, Thailand and Macau. Li’s flagship investment vehicle Pacific Century Group completed the $2.14 billion acquisition in February last year. “That was a perfect start,” Huynh said.

FWD was granted a licence in the Philippines and is the first major foreign life insurer to win a licence there for years since Maritime Life of Nova Scotia in 2004. “We’re working very hard to build our operation there — the macro trend looks good,” he said.

FWD has a strategic cooperation agreement with Indonesia’s PT Finansial Wiramitra Danadyaksa, which was established in November 2012, and is operating under licence from Otoritas Jasa Keuangan. The two partners do not have a cross-shareholding. 

“We provide technical and managerial expertise. In the meantime we have a chance to learn much more about the local market,” said Huynh.
In Malaysia, FWD was one of the final bidders for a stake in AMMB Holdings’ insurance arm but lost out to the US’s Metlife. “We continue to look for opportunities in Malaysia and Vietnam and other Asean countries,” said Huynh, who was born in Vietnam but grew up in Canada.

New licences are very rare in Malaysia and foreigners are not allowed to own more than 70% of an insurer. “With the right partner the initial size doesn’t matter,” especially one with bancassurance distribution, Huynh said.

Huynh said FWD is not actively seeking a foothold in Myanmar as yet. “We continue to watch Myanmar with interest — but it looks premature at present,” he said. Foreign insurers are only allowed to open representative offices in Myanmar as the government seeks to protect its nascent domestic players.
FWD does not have a licence in mainland China. “Competition is fierce and market entry is not easy,” said Huynh. An insurer has to have a representative office in China for two years before even applying for a licence.

Banking on growth
FWD was also among the bidders when Citi auctioned rights for selling insurance policies through its Asian bank branches — a relationship between an insurer and a bank known in the industry as bancassurance.

“Banks will continue to be a critical part of distribution going forward and competition will be intense for any relationship coming up for renewal,” Huynh said, sighing when he was asked about the big up-front payments banks are demanding these days for distribution rights.

Aviva’s bancassurance relationship with Singapore’s DBS is up for renewal next year and insurers are lining up to eject the British insurer and step in on more attractive terms for the bank, according to people familiar with the matter.

He spies one positive trend in the growing length of bancassurance relationships, which encourages more investment by both parties and the sale of more complex higher-margin products.

FWD already has a bancassurance relationship with the Thai Military Bank (TMB) and in Hong Kong with the Bank of Communications and China Construction Bank.

FWD is investing in making sales through banks or door-to-door agents more transparent, compliant and less bureaucratic using technology.

At TMB, one of its biggest bancassurance channels, FWD supports the bank branch salespeople with technology and has some of its own people embedded in the network. “By the time the client has had a cup of coffee they should have been presented with the policy either on screen or printed if they prefer — none of that mail it to you later stuff,” Huynh said.

The same goes for when an agent makes a sale — the whole consultation process is supported by technology: the signing is on the tablet and the payment is an e-payment. In a clean case, documentation and approval can be instantaneous. 

This helps FWD control the conversation between the agent and the client — forms are instantaneously updated — making sure everything is compliant and transparent. 

“In Hong Kong a lot of agents are still using paper and pen — we make it screen-based and give them a tablet,” said Huynh, “We don’t give our agents a pen anymore.”

Technology is also helping FWD’s sales force to target the right people by harnessing Big Data, which helps insurers identify who needs which policy at what stage in their life.

“That is one of our big strengths in a market like Hong Kong and that same skill could be employed in a country like Indonesia where Big Data could be amazing.”  

© Haymarket Media Limited. All rights reserved.

Richard trained at Gordon Capital in Torontowhich he subsequently bought in the 1990's and sold to HSBC

"In the 1980s, Gordon Capital pioneered the “bought deal,” wherein a brokerage buys an entire stock offering directly from an issuer at a discounted price. If the shares aren’t flipped to third-party investors quickly, the broker can take a disastrous hit."   -- GLOBE & MAIL 2016 February 6

Thursday, January 9, 2014

Run Run Shaw

Sir Run Run Shaw - Godfather of the Silver Screen in Asia

HK media mogul Run Run Shaw dies at 106
Bighearted: Besides his achievements in film and TV, Mr Shaw was also a noted philanthropist, donating millions to charity through his Shaw Foundation, mostly to causes in China. - AFP FILE PHOTO
[HONG KONG] Hong Kong media mogul Run Run Shaw, who created an empire in Asia spanning movies to television, died yesterday at the age of 106, his company said.
Mr Shaw died peacefully at his home in Hong Kong, surrounded by his family, his company, Television Broadcasts Ltd (TVB) , said in a statement.
One of Hong Kong cinema's defining figures, Mr Shaw popularised Chinese kung fu films in the West and helped turn the former British colony into a "Hollywood East" over an 80-year career.
He set up Hong Kong's biggest free-to-air television operator, TVB, in 1967 and served as its executive chairman until 2011, helping to shape the city's media culture.