Standard shares slip in stake sale talk

Standard Chartered shares fell more than 3 per cent yesterday as speculation resurfaced that Singapore state investor Temasek may sell its 18 per cent stake in the Asia-focused bank.
By The Newsroom
Published 26th Sep 2012, 07:00 BST

The Financial Times said Temasek had sounded out possible buyers for the £6.4bn ($10.4bn) stake, but was not in active talks to sell it. Industry sources told Reuters they were not aware of any ongoing talks.

Temasek also kicked off a $1.3bn sale of shares in Singapore Telecommunications, suggesting it could be more actively managing its portfolio.

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StanChart, long a focus of bid speculation, could appeal to rivals such as JPMorgan Chase & Co, Industrial and Commercial Bank of China, China Construction Bank, Bank of Communications, or other rivals keen to grab a strong Asian exposure or wholesale banking position, analysts said.

“Standard Chartered (is) widely seen as a unique franchise given its pan Asia/Middle East/Africa footprint and comprehensive wholesale banking product offering,” said Cormac Leech, analyst at Liberum Capital.

But talk that a bank will buy StanChart has been present since Lloyds made a hostile bid in 1986.

“Standard Chartered’s extensive ... franchise makes the prospect of a strategic stake attractive for a bank looking to increase exposure to emerging markets, particularly in the wake of recent capacity withdrawal by European banks,” said Mike Trippitt, an analyst at Oriel Securities.

But there are several obstacles to a takeover or stake purchase, analysts said.