- SINGAPORE'S state-owned investment vehicle Temasek Holdings said today that it has sold its entire stake in the Bank of America.
A Temasek spokesman said: 'We have divested our shares in Bank of America.'
The Straits Times understands the sale was done via a series of transactions in the first quarter of this year.
Temasek declined to reveal the average price it got for its 188.8 million shares, but preliminary estimates put the potential loss at a whopping US$4.26 billion.
Temasek had paid about US$5.9 billion for a 13.7 per cent stake in Merrill Lynch since December 2007, which was converted into Bank of America stock following the completion of the acquisition. This gave it a stake of some 188.8 million Bank of America shares, or about 3.8 per cent.
Reuters cited a source briefed on the deal saying that the shares were sold for between US$2.53 and US$14.81 in the first quarter.
Based on a Reuters calculation which assumed an average price of US$8.67, Temasek may have suffered a loss of about US$4.26 billion.
Temasek's net portfolio value dropped 31 per cent between March 31 and Nov 30 last year, from $185 billion to $127 billion.
- Anyway I am thinking out loud here. My thinking could be obviously flawed but I cannot stop wondering about Singapore GIC. What are they thinking? Obviously Citigroup and UBS were terrible mistakes and they paid some terribly high prices for their mistakes. So why couldn't they just admit they made a terrible mistake and realise their losses? Why can't they cut loss? Why insist on taking this long term approach? Don't they realise that holding them long term solves nothing? Long term investors? They look like long term mistake holders!
Well looks like they are finally admitting to their terrible investing mistake in Bank Of America. Bravo! It takes a big man to admit to their mistakes man!
ps: see also Neptune Orient Lines (NOL) Suffers Huge Losses - Big Ouch For Temasek! and Temasek Holdings Chalking Up Massive Paper Losses Everywhere!
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