Hutchison Port Holdings Trust

[Ray168]

The direct shareholder is actually PSA.

PSA was also a sponsor of HPHT and did not subscribe for HPHT units during the IPO. In April 2006, PSA paid US$4.4b for 20% of HPH. Upon IPO, PSA received 905m units of HPHT valued at US$1 each. PSA also received about US$2.5b cash from the IPO.

https://www.smh.com.au/business/psa-pays...dneza.html

Since IPO, per unit distributions totaled HKD$2.2406. Converted to US$ at present rates, and multiplied by PSA's number of units (905m units), this is about US$285m. Combined with the market value of the 905 units, the sum is US$510m. Including the cash PSA received from IPO, its value of investment went from US$4.4b to US$3b. So far the losses stand at US$1.4b. HPH may have paid some dividends between 2006 and 2011, so this figure could be smaller.

At best, they broke even, or suffered small losses. But its clear that PSA has put its HPH mistake behind it.

PSA recently increased its stake in HPHT to about 12%, which at current market value is about S$360m. As at December 2017, PSA had an equity of S$11b. This means that its PSA stake is now only about 3% of its equity. As PSA continues to grow, and HPHT continues to shrink, the significance of HPHT to PSA decreases.

Lesson for investors: If you want to invest, make sure you have other generators of cash flow that will allow your net worth to keep growing even as your investment(s) blow.

From Temasek's perspective, the mistake of buying HPH looks even smaller. Temasek receives about $8b in dividends a year, and has a portfolio value north of S$300b. This means Temasek would have recouped its HPH losses with just a year of dividends, if it didn't invest in anything else. From the portfolio perspective, the losses of US1.4b is merely 0.6% of its current portfolio.

Lesson for investors: You can follow Temasek and make the kind of mistakes PSA/Temasek did, if the size of the mistake in your portfolio is minuscule.

PSA / Temasek share holding as of todate is 1,133,677,000 or 13.01%. Bought @ usd2.55 ~ 3.05