The government’s stake within the company have made expansion difficult and may have the been the cause of two unsuccessful attempts to make strategic investments last year in Hong Kong and Malaysia which were vetoed on nationalist grounds within the target countries. With the 78% stake in SingTel between government and the SingTel company now reduced there will be less objection from neighboring states.
Lee Hsien Loong, Singapore’s deputy Prime Minister, told Parliament, For SingTel we will remove the special share, which gives the government the right to veto major decisions in the company. Instead, we will meet our national security needs through appropriate safeguards.
This may precipitate a precedent for the government to significantly reduce its involvement in other companies such as DBS, south-east Asia’s bank where 37% in still in national hands.
Richard Alston, Australia’s communications minister, told reporters that the government now scrutinize any Singapore governmental involvement in Singtel before the deal could be formally approved, If we get to that stage, there will obviously be discussions to explore the nature and extent of the Singapore government’s involvement, he said.
