Dear Shareholders,
On behalf of the Board of Directors, it is my pleasure to
present to you the Annual Report of The Straits Trading
Company Limited (“Straits Trading” or “the Company”) for
the year ended 31 December 2014.
Over the past few years, Straits Trading has undergone a
remarkable transformation from a company with diverse
assets into an investment company, with platforms of
growth in its various businesses.
A NEW BUSINESS MODEL
Straits Trading aims to create sustainable growth by
enhancing the value of our stakes in these various platforms
through the allocation of capital. Through the transformation
of our various businesses, our stakes may have become
smaller but the platforms are certainly stronger, and scalable
with greater growth potential. We maintain a disciplined
approach to identifying and acquiring, at attractive prices,
good assets that can deliver sustainable cash earnings over
the long-term. Coupled with skilful management, this will
enable us to deliver superior and sustainable shareholder
returns over the long run.
Today, Straits Trading has stakes in different operating
platforms including:
1. an 89.5% stake in Straits Real Estate Pte. Ltd. (“Straits
Real Estate”); a co-investment vehicle that seeks out real
estate related investments & opportunities globally;
2. a 20.1% stake in SGX-listed ARA Asset Management
Limited (“ARA”), one of the largest real estate fund
managers in the region;
3. a 6.1% aggregate interest in Suntec REIT, one of the
largest SGX-listed real estate investment trusts that owns
prime office and retail space in the Central Business
District of Singapore;
4. a 30% interest in Far East Hospitality Holdings Pte. Ltd.
(“Far East Hospitality”), one of the largest hospitality
operators in the Asia Pacific and;
5. a 54.8% stake in Malaysia Smelting Corporation Berhad
(“MSC”), one of the world’s largest integrated producers
of tin metal.
Integral to our strategy is our real estate ecosystem;
anchored by our investments in the various real estate
related businesses. Through this ecosystem, Straits
Trading can access a wide spectrum of real estate related
opportunities from seeding and sponsoring real estate
funds, investing in real estate securities and directly investing
in real estate.
Realising the full potential of our platforms will take
time to stabilise and gain traction, but I am pleased to
report good progress over the last year. We see early signs
of improvement in our underlying operations and the
development of our businesses.
LEADERSHIP AND ORGANISATIONAL CHANGES
With the creation of various platforms of growth, the
executive management of our businesses has been
devolved to the operating entities. Each of our portfolio
companies is led by an experienced management team
headed by a chief executive. Our board representation
on the boards of these portfolio companies allows us to
participate in crucial decisions.
Leadership of Straits Trading now resides with the Executive
Chairman and the Board of Directors (“Board”). With this
greater reliance on the Board, we aim to tap not just their
collective expertise but also the specific skills and expertise
of individual Board members, who may, from time to time,
be called upon to sit in special sub-committees or to assist
in special projects in relation to the portfolio companies.
With the executive management of our businesses now
concentrated within the operating entities, the leadership
and organisational structure of Straits Trading has become
much leaner.
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THE STRAITS TRADING COMPANY LIMITED ANNUAL REPORT 2014
