- Joined
- Dec 30, 2010
- Messages
- 12,730
- Points
- 113
As can be observed from the above two stock charts, both SBS Transit and SMRT Corporation have seen their share prices decline inexorably for the past three years (2011-2014).
The sudden increase in their share prices due to the LTA announcement demonstrates that the market perceives that the government has essentially bailed out these two Government-Linked Corporations (GLCs).
Taxpayer dollars will be used to re-acquire bus operating assets from both SMRT Corporation as well as SBS Transit. These two companies will therefore receive a financial rescue package and be relieved of the burden of holding on to the bus operating assets.
The reason why the government has moved to a semi-nationalization of the bus industry, reversing decades of privatization, is because it has become clear in recent years that the old privatized model has failed to deliver good service to bus commuters, who have had to endure the ignominy of paying higher and higher fares whilst enduring declining service standards.
http://www.sgpolitics.net/?p=8775
The sudden increase in their share prices due to the LTA announcement demonstrates that the market perceives that the government has essentially bailed out these two Government-Linked Corporations (GLCs).
Taxpayer dollars will be used to re-acquire bus operating assets from both SMRT Corporation as well as SBS Transit. These two companies will therefore receive a financial rescue package and be relieved of the burden of holding on to the bus operating assets.
The reason why the government has moved to a semi-nationalization of the bus industry, reversing decades of privatization, is because it has become clear in recent years that the old privatized model has failed to deliver good service to bus commuters, who have had to endure the ignominy of paying higher and higher fares whilst enduring declining service standards.
http://www.sgpolitics.net/?p=8775
