An half a billion lost from Sinkapore Inc

[winnipegjets]

SIA to sell Virgin Atlantic stake for US$360 million

Reuters
Tuesday, Dec 11, 2012

LONDON - US carrier Delta Air Lines said it had bought Singapore Airlines' 49 per cent stake in Britain's Virgin Atlantic for US$360 million (S$440 million) and agreed a transatlantic joint venture with Virgin.

Virgin and Delta on Tuesday said under the joint venture they would share costs and revenues on routes between Britain and North America.

The pair plan to cooperate on services between New York and London, with a total of nine daily round-trip flights from London Heathrow to John F. Kennedy International Airport and Newark Liberty International Airport.

"Our new partnership with Virgin Atlantic will strengthen both airlines and provide a more effective competitor between North America and the UK, particularly on the New York-London route, which is the largest airline route between the US and Europe," said Delta Chief Executive Richard Anderson.

The airlines said they would file an application with the US Department of Transportation for competition clearance and that the deal would need to be reviewed by the US Department of Justice and the European Union's competition regulator.

The deal will enable Delta to expand at London's Heathrow airport, a lucrative hub for corporate passengers where landing slots are generally hard to acquire. Virgin is the second-largest carrier at Heathrow after IAG's British Airways.

Heathrow, Europe's busiest airport, is operating at close to full capacity after Britain's coalition government blocked its expansion in 2010.

British entrepreneur Richard Branson said he would retain his 51 per cent stake in Virgin Atlantic and maintain the brand of the airline he founded in 1984.

"The partnership allows both carriers to offer a greatly expanded network at Heathrow and to overcome slot constraints, which have limited the growth and competitive capability of both airlines," said Branson.

The two carriers will operate a total of 31 peak-day round-trip flights between the UK and North America, 23 of which operate at London Heathrow.

The partnership will be similar to that operated by American Airlines and IAG's British Airways (BA) since 2010 on transatlantic and some European routes.

Singapore Airlines bought 49 per cent of Virgin Atlantic for US$965 million in 1999, but has been open to selling its stake since at least mid-2011 when a price of US$500-US$600 million was mooted in markets.

Singapore Airlines has been refocusing on its key markets where it is under pressure from budget airlines, launching its own budget carrier, Scoot, to ply Asian middle-distance routes and bolstering its Asian regional carrier, SilkAir.

 

[winnipegjets]

Sinkapore Inc really sucks....they are losing money all over the shop. We need a complete audit of Temasek and the GIC to establish if these two investment agencies are truly profitable.

 

[Bigfuck]

I am beginning to become convinced Leegime is pocketing kickbacks through pre-arranged losses. The other is of course they are class one clutzes. Time to open books.

 

[ray_of_hope]

This was bought by the then CEO Cheong. Of course he was a former Malaysian, and so what do we expect!!!

 

[Froggy]

If these fuckers make money then it'll be a surprise.

 

[Narong Wongwan]

I am beginning to become convinced Leegime is pocketing kickbacks through pre-arranged losses. The other is of course they are class one clutzes. Time to open books.

Realized loss liao can still call long term investment?
Win some lose some? Seems like never win at all.

 

[Wildfire]

Strangely, SIA claims that it will be booking in a "profit" from this sale :*:

Guess they must have written off or write down the investment sometime back!

"In a statement issued this evening, Singapore Airlines said it had been "evaluating strategic options for the stake
for some time, as the investment has not performed to expectations and the synergies the parties originally hoped
for have not materialised".

It also said the sale will result in a profit being booked in its accounts." ST Online

 

[pegasus]

The background to this purchase is as follows: CK Cheong, than CEO of SIA was very excited when Branson offered to sell 49% to SIA. Branson-worshiping Cheong flew to London to meet Branson at a hotel. Over coffee, they negotiated and reached a deal in a day or so and the agreed figure was 960m. They initialed the deal on a napkin, boasted Cheong at that time. It later transpired that Branson had assumed that he sold hs share for SGD960 but the over excited star struck Cheong thought Branson meant USD!!! Branson did the classic snook. The rest is history. This is a true story. CK Cheong when he was CEO was just coasting along on the success of JYM Pillay and others who built the airline. The problems in SIA today are the result of CK Cheong's complacency. The present lot in SIA are also coasting along. Whats happening in SIA today is not dissimilar to the sickness of he PAP today. Very sad indeed that such a wonderful airline is just going down the drain.

 

[ray_of_hope]

The last time I travelled on SIA the economy class meal tasted like swill... !!!

 

[iluvgst]

SIA has a truly Midas touch...

 

[Froggy]

The last time I travelled on SIA the economy class meal tasted like swill... !!!

Last month flew from Bangkok to Singapore had this for lunch, what a pleasant surprise

This is very traditional Thai desserts, nice

 

[Conqueror]

More Losses Accumulated Tis Year

SIA has a truly Midas touch...

Singapore Airlines Profit Falls 54% as Cargo Loss Triples

Singapore Airlines Ltd. (SIA) posted a worse-than-estimated 54 percent drop in quarterly profit after losses at its cargo unit tripled.

Net income fell to S$90.1 million ($74 million) in the three months ended September from S$194.2 million a year earlier, the airline said in a statement yesterday. Analysts expected a profit of S$141 million, based on the average of five estimates compiled by Bloomberg. Revenue rose 2.5 percent to S$3.8 billion.

Losses at the cargo unit jumped to S$50 million amid a global trade slowdown and rising competition from Middle East carriers. The airline, the world’s second-largest by market value, said it will further reduce cargo capacity by parking one of its 13 Boeing Co. 747 freighters for more than a year.

“There’s very weak demand, and it’s very difficult to change that,” said K. Ajith, an analyst at UOB-Kay Hian Research Ltd. in Singapore. “SIA is doing the right thing by cutting cargo capacity.”

UOB-Kay Hian had expected the cargo unit to post a S$37 million loss for the quarter, he said.

Operating profit at the main airline unit fell 5.6 percent to S$84 million in the second quarter. The engineering division’s earnings fell 5.9 to S$32 million, while regional carrier SilkAir boosted operating profit 46 percent to S$19 million. The figures were derived by subtracting first-quarter earnings from the first-half results.

 

[Sinkie]

Re: More Losses Accumulated Tis Year

Tat's alot of money to lose...damn!

 

[HorGauGan]

wat's inside? outside looks like plastic toy :(

Last month flew from Bangkok to Singapore had this for lunch, what a pleasant surprise

This is very traditional Thai desserts, nice

 

[Force 136]

Surely the permission of PM must be sought in order to sell away National assets at a loss?

 

[Charlie99]

The background to this purchase is as follows: CK Cheong, than CEO of SIA was very excited when Branson offered to sell 49% to SIA. Branson-worshiping Cheong flew to London to meet Branson at a hotel. Over coffee, they negotiated and reached a deal in a day or so and the agreed figure was 960m. They initialed the deal on a napkin, boasted Cheong at that time. It later transpired that Branson had assumed that he sold hs share for SGD960 but the over excited star struck Cheong thought Branson meant USD!!! Branson did the classic snook. The rest is history. This is a true story. CK Cheong when he was CEO was just coasting along on the success of JYM Pillay and others who built the airline. The problems in SIA today are the result of CK Cheong's complacency. The present lot in SIA are also coasting along. Whats happening in SIA today is not dissimilar to the sickness of he PAP today. Very sad indeed that such a wonderful airline is just going down the drain.

Very unfortunate.

If CCK was in any doubt, he should have played dumb, and claimed that his offer was in SGD, and stick to it SGD$960 million, otherwise, no deal, and do not follow through with the execution of the agreement of purchase and sale.

I do not know when they are going to learn, as in trying to avoid some form of social assistance to the financially destitute elderly and physically handicapped, and perhaps, really subsidize health care and HDB flats, rather than "waste" or "lose" $500 million here, or $100 million there.

 

[scroobal]

Slight cosmetic correction but or else you are absolutely spot on as usual.

Formal negotiations failed and they agreed to part. Both parties then went to have dinner and ended up in the same restaurant but at different tables. Then the napkin came out.

Shortly after the deal was consummated, SIA realised that formula did not favour them. It was a similar formula that Branson used in all his ventures and where his partners would ride on his branding. SIA had its own brand and did not understand this and assumed that they would use the code sharing to penetrate the US. It took them less than a year before they were open to a buy out. They could also not understand that all of Branson's partners eventually came out of partnerships.

SIA had a golden opportunity to take over the Ansett routes and were begged to takeover including the airport facilities. They even had their dicks sucked in Melbourne immensely but did not bite. Branson took over and made it work.

The background to this purchase is as follows: CK Cheong, than CEO of SIA was very excited when Branson offered to sell 49% to SIA. Branson-worshiping Cheong flew to London to meet Branson at a hotel. Over coffee, they negotiated and reached a deal in a day or so and the agreed figure was 960m. They initialed the deal on a napkin, boasted Cheong at that time. It later transpired that Branson had assumed that he sold hs share for SGD960 but the over excited star struck Cheong thought Branson meant USD!!! Branson did the classic snook. The rest is history. This is a true story. CK Cheong when he was CEO was just coasting along on the success of JYM Pillay and others who built the airline. The problems in SIA today are the result of CK Cheong's complacency. The present lot in SIA are also coasting along. Whats happening in SIA today is not dissimilar to the sickness of he PAP today. Very sad indeed that such a wonderful airline is just going down the drain.

 

[sirus]

Surely the permission of PM must be sought in order to sell away National assets at a loss?

Not only PM, Tony Tan said he will guard our asset during PE no?

 

[Merl Haggard]

SIA to sell Virgin Atlantic stake for US$360 million

Reuters
Tuesday, Dec 11, 2012

LONDON - US carrier Delta Air Lines said it had bought Singapore Airlines' 49 per cent stake in Britain's Virgin Atlantic for US$360 million (S$440 million) and agreed a transatlantic joint venture with Virgin.

Singapore Airlines bought 49 per cent of Virgin Atlantic for US$965 million in 1999, but has been open to selling its stake since at least mid-2011 when a price of US$500-US$600 million was mooted in markets.

US Dollar in 1999 was 1.73 Sing.

Actual loss is S$1.23b.

 

[lee6100]

SIA had a golden opportunity to take over the Ansett routes and were begged to takeover including the airport facilities. They even had their dicks sucked in Melbourne immensely but did not bite. Branson took over and made it work.

They also dissed off Tony Fernandes when he was starting out and wanted to set up shop in Singapore. In Ozland they kept wanting to do things with Geoff Dixon, the anglophobe racist. SQ, like the rest of the dickheads in Singapore Inc, is a sucker for credentialism; only the elites and big boys are worth talking to. And they are poor judges of character. So it wont be surprising if Verghese turns out to be like Fast Eddie.



"If capitalists had been present at Kitty Hawk when the Wright brothers' plane first took off, they should have shot it down." Warren Buffett, after his failed investment in American Airlines.