TECHNOLOGIES HOLDINGS GROUP (Investment in Silicon Valley)

Mr Ling How Doong asked the Minister for Finance if he will say what was the total amount of investment by Singapore through Technologies Holdings Group in the Silicon Valley in Australia; whether the investment suffered any loss in 1991 and 1992; and what was the extent of the loss.

Dr Richard Hu Tsu Tau: Sir, the hon. Member refers to the "Silicon Valley in Australia". I am not aware of such a place. I am assuming he means the Silicon Valley of California, USA.

Singapore Technologies Ventures (STV) is one of the five sector companies in Singapore Technologies Holdings (STH) and has invested a total of S$38 million in Silicon Valley companies. Net loss from those investments in 1991 amounted to S$5 million. Net loss in 1992 is expected to be less than S$0.5 million.

Investment in venture companies should be seen in a wider context and over a longer time frame. Not all investments will be profitable, nor always on a year by year basis. For example, total STV venture capital investments in the United States as well as other parts of the world are S$80 million at cost. For these investments, including those in Silicon Valley, while net loss in 1991 was S$7 million, for the period January to August 1992, there is a net realised gain of S$16 million. Additional net unrealised gain to date is more than S$50 million.

Another STH sector company, Chartered Industries of Singapore (CIS) has invested S$280,000 in one company in Silicon Valley. This company has got into financial difficulties. CIS will be writing off this investment in its 1992 accounts.

The remaining three sector companies of STH have no investments in the Silicon Valley.