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Top 10 Singapore business stories in 2018

As 2018 comes to an end, let’s take a look at the year’s top 10 business stories in Singapore.

10. NTUC Enterprise to buy food court operator Kopitiam

Kopitiam’s food court. (Yahoo News file photo)
Kopitiam’s food court. (Yahoo News file photo)

NTUC Enterprise announced it will acquire home-grown food court operator Kopitiam Investment and its subsidiaries by the end of this year.

With the deal, Kopitiam’s 56 food courts, 21 coffeeshops, three hawker centres and two central kitchens will be under NTUC’s portfolio. The sum of the deal was not disclosed.

Hawker centres are very much in the news in the controversy surrounding social enterprise hawker centres and the stall-owners over rules change. This saga prompted citizens and hawkers to call out the relevant authorities to review the situation. The National Environment Agency in November introduced new rules for SEHCs on key areas such as operating hours and termination clauses to take effect from 1 January.

9. Singapore Airlines to absorb regional arm SilkAir

SilkAir to transfer some routes to Scoot ahead of merger with SIA. (File photo)
SilkAir to transfer some routes to Scoot ahead of merger with SIA. (File photo)

Singapore Airlines in May announced plans to absorb its underperforming regional arm SilkAir after 2020 when a programme to upgrade cabins at a cost of more than S$100 million ($74.5 million) gets underway.

The move comes as SIA undertakes a three-year transformation programme designed to cut costs and boost revenue amid competition from Chinese and Middle Eastern rivals and low-cost carriers. SilkAir is a weak spot for SIA, with its full-year operating profit for the year ended March 31, down 57 per cent from a year earlier.

Ahead of the merger, Singapore Airlines in November said its budget carrier Scoot will take over some routes from regional airline SilkAir over the next two years.

8. Noble Group wins lifeline as shareholders back US$3.5 billion debt restructuring

Photo of Noble Group logo at investor event from August 2015/File Photo/File Photo
Photo of Noble Group logo at investor event from August 2015/File Photo/File Photo

The Noble Group saga continues. The embattled commodity trader on 14 December said a Bermuda court has granted an order to appoint an officer of the court to the company to facilitate the implementation of its financial restructuring, and anticipate it will occur on 19 December.

The company filed an application in Bermuda court after the Singapore authorities on 6 December said Noble won’t be allowed to transfer its listing status to the restructured entity New Noble amid an investigation into the company.

The Singapore authorities on 20 November said they are investigating Noble Group for suspected false and misleading statements, and its subsidiary Noble Resources International for potential non-compliance with accounting standards.

Noble had to extend the deadline for its debt restructuring to 11 December from 26 November to address concerns of the authorities amid the ongoing probe.

The company in August won approval from shareholders for a US$3.5 billion (S$4.8 million) debt restructuring plan that should ensure the survival of what was once Asia’s biggest commodity trader.

7. Dyson chooses Singapore over Britain to build electric car

British industrial design engineer and founder of the Dyson company, James Dyson. (Photo:CHRISTOPHE ARCHAMBAULT/AFP/Getty Images)
British industrial design engineer and founder of the Dyson company, James Dyson. (Photo:CHRISTOPHE ARCHAMBAULT/AFP/Getty Images)

James Dyson, the billionaire British inventor of the bagless vacuum cleaner, has chosen to build his first electric car in Singapore, snubbing Britain.

What could have influenced the decision? Singapore is one of the world’s most expensive places to own a car, and it has also been nearly 40 years since Ford closed its factory in the city-state, effectively ending car production.;.

The 71-year-old entrepreneur, who backed Brexit in the 2016 referendum, already employs over a 1,000 people in Singapore making 21 million digital electric motors annually. Singapore also offers access to high-growth markets as well as an extensive supply chain and a highly-skilled workforce, Dyson’s CEO Jim Rowan said.

6. Struggling Hyflux to sell majority stake to Indonesian groups

Hyflux Tuaspring integrated water and power project. Photo: Hyflux
Hyflux Tuaspring integrated water and power project. Photo: Hyflux

Singapore water treatment firm Hyflux Ltd, which is in the midst of a court-supervised reorganisation, said a consortium comprising Indonesia’s Salim Group and Medco Group had agreed to acquire 60 per cent of the company for S$400 million ($290 million).

The loss-making company got a lifeline after the consortium called SM Investments, also agreed to give Hyflux a loan of S$130 million.

Hyflux started the process of a court-supervised reorganisation of its business in May to protect it against creditors as it restructured its debt.

5. Facebook to invest $1 billion in first Asian data center in Singapore

Facebook Singapore data centre. Source: Facebook
Facebook Singapore data centre. Source: Facebook

Facebook said it will invest more than $1 billion to build its first data center in Asia in Singapore, slated to open in 2022.

Facebook’s facility will be located in the west of the island, near where Google is expanding its Singapore data centers in an $850 million investment as mobile growth, e-commerce and cloud computing demand rise across the region.

4. Singapore ‘en-bloc’ sales collapse after latest property curbs

General view of apartment blocks consisting of private and public housing, in Singapore, (Photo:REUTERS/Kevin Lam)
General view of apartment blocks consisting of private and public housing, in Singapore, (Photo:REUTERS/Kevin Lam)

Singapore residential-property investment sales have collapsed after the latest round of housing curbs put the brakes on ‘en-bloc’ redevelopment deals.

The government took steps in July to cool the property market after a steep rise in prices in the first six months of this year.

The Monetary Authority of Singapore in November noted in its annual Financial Stability Review that since the measures were announced, property developers have become more cautious and en-bloc activity has also slowed significantly.

3. The ticking time bomb of the 99-year-leasehold HDB flats

Clothes are hung for drying outside public housing estate flats built by the Housing and Development Board. (Photo: REUTERS/Nicky Loh)
Clothes are hung for drying outside public housing estate flats built by the Housing and Development Board. (Photo: REUTERS/Nicky Loh)

Almost sex decades after since the Housing Development Board was established, a new concern has arisen – expiring 99-year leases of old HDB flats.

The lease issue became a hot topic following a blog post by Lawrence Wong, Minister for National Development, last year when he cautioned that not all old flats will be eligible for the Selective En-bloc Redevelopment Scheme (SERS), and those left out will be returned to the state when the 99-year lease matures.

To allay anxious homeowners as prices of older HDB dropped, Prime Minister Lee Hsien Loong announced at the National Day rally the government is planning a new scheme Voluntary Early Redevelopment Scheme (VERS), planned to redevelop more old HDB flats before their leases end.

With VERS, the government can buy back flats that are 70 years old and or more, subject to residents’ votes. Residents will receive compensation, but terms will be less generous than SERS. The government will study the affordability of the plan which will not be implemented for another 20 years.

2. Uber exits SE Asia in new retreat from global markets

A ComfortDelgro taxi passes Uber and Grab offices in Singapore March 26, 2018. REUTERS/Edgar Su TPX IMAGES OF THE DAY
A ComfortDelgro taxi passes Uber and Grab offices in Singapore March 26, 2018. REUTERS/Edgar Su TPX IMAGES OF THE DAY

Uber Technologies agreed in late March to sell its Southeast Asian business to bigger regional rival Grab, marking the U.S. company’s second retreat from an Asian market.

The deal with Grab, which operates in eight Southeast Asian countries, is similar to the one struck with China’s Didi Chuxing in 2016, and ends a fight for market share in a region that is home to some 650 million people and an increasingly affluent middle class.

Six months after the deal was announced, Singapore anti-trust watchdog fined Grab and Uber a combined S$13 million ($9.5 million) and finalised restrictions to open up the market to competitors.

Indonesia’s Go-Jek on 29 November launched a beta version of its ride-hailing taxi app in Singapore, ahead of a full entry planned early next year as it takes on market leader Grab.

1. Singapore moves to cool down resurgent property market

High-rise and low-rise apartment blocks consisting of private and public housing are seen in Tiong Bahru, Singapore. (Photo: REUTERS/Kevin Lam)
High-rise and low-rise apartment blocks consisting of private and public housing are seen in Tiong Bahru, Singapore. (Photo: REUTERS/Kevin Lam)

Singapore in July raised buyers’ fees and tightened loan requirements to cool a resurgent property sector.

The surprise move comes hot on the heels of the release of second-quarter flash estimates which showed private home prices had risen to its highest point in over four years.

The Monetary Authority of Singapore warned that the sharp increase in prices, if left unchecked, could run ahead of economic fundamentals and raise the risk of a destabilising correction later.

Last month the central bank in its Financial Stability Review said households should continue to be prudent when considering take loans to buy property in light of interest rate increases and the upcoming supply of new units in the medium term.

The government on 6 December announced it has cut the total land supply for private homes in its first-half 2019 Government Land Sales (GLS) programme as demand waned.