Temasek Holdings Boosted Stake in U.S. Health-Care Industry

May 15, 2014 10:32 pm ET

(Updates with value of Gilead in second paragraph, details about Turquoise Hill in eighth.)

May 16 (Bloomberg) -- Temasek Holdings Pte, Singapore’s state-owned investment firm, purchased stocks in Thermo Fisher Scientific Inc. and BioMarin Pharmaceutical Inc. in the first quarter as it boosted its stake in the U.S. health-care industry.

Temasek, directly or through its units, bought 5.3 million shares valued at $634 million in Thermo Fisher, a manufacturer of scientific instruments and chemicals, according to a filing yesterday with the U.S. Securities and Exchange Commission. It purchased 1.6 million shares valued at $106 million in BioMarin Pharmaceutical, a developer of therapeutic enzyme products. The firm also almost doubled its stake in biopharmaceutical company Gilead Sciences Inc. to 12.6 million shares, valued at $891 million, according to the filing.

The transactions came as Temasek in March agreed to buy a 25 percent stake in Hong Kong-based Hutchison Whampoa Ltd.’s retail arm A.S. Watson & Co., which owns health and beauty stores, for HK$44 billion ($5.7 billion). The health-care industry is expected to expand as people live longer and the growing middle class in emerging markets can afford better treatment. Life expectancy around the world surged in the past two decades as the rate of child mortality declined in Africa and wealthier countries improved monitoring and treatment of chronic diseases, according to a study by the World Health Organization.

Developed Markets

“The state funds are focusing on products for the aging and informed consumers in developed markets,”said Enrico Soddu, an analyst at the London-based Institutional Investor’s Sovereign Wealth Center. “We might see more of that in the coming months.”

Stephen Forshaw, a spokesman for Temasek, confirmed the filing.

“The changes in holdings of various companies are part of the ongoing cycle of rebalancing the portfolio,” Forshaw said. “Some adjustments occur where we have an opportunity to invest in companies consistent with our investment themes.”

Acquiring stakes in “companies with distinctive intellectual property and other competitive advantages” is one of the investment themes of Temasek, according to its website.

Oyu Tolgoi

Temasek also doubled its holdings in Vancouver-based Turquoise Hill Resources Ltd., owner of the Oyu Tolgoi mine in Mongolia, and now owns 73.2 million shares, according to the filing. Turquoise is 51 percent owned by Rio Tinto Group, which is in discussions with the Mongolian government about the financing of the expansion of Oyu Tolgoi.

Temasek, wholly owned by Singapore’s Ministry of Finance, is the ninth-biggest state investor with an estimated $173 billion of assets, according to the website of the Sovereign Wealth Center. The world’s biggest is Norway’s Government Pension Fund Global, while Singapore’s other sovereign investor GIC Pte ranks fifth, according to the center’s estimates.

Money managers who oversee more than $100 million in equities must file a Form 13F with the SEC within 45 days of each quarter’s end to show their U.S.-listed stocks, options and convertible bonds. The filings don’t show non-U.S. securities or how much cash the firms hold.