UPDATE 1-Singapore govt to put Changi Airport under Temasek
(Adds details, background)
SINGAPORE, Oct 7 (Reuters) - Singapore's Changi Airport will be split into two entities by July 2009 -- an airport company under state investor Temasek Holdings and a regulatory body that will oversee the city-state's airports. The new airport company, which will manage the city-state's Changi Airport and investments in foreign airports, will be a wholly owned subsidiary of Temasek [TEM.UL], Singapore's Transport Minister Raymond Lim said on Tuesday.
"A corporatised entity will have greater flexibility to attract and retain top talent to compete with global airport operators. It can also better leverage on Changi Airport's brand name to develop an international presence," Lim said.
Changi Airport, Singapore's main airport, is one of Asia's busiest aviation hubs with 36.7 million passengers passing through its terminals last year.
Changi Airports International, its overseas arm, owns a minority stake in China's Nanjing Lukou International Airport and provides management and consultancy services in several countries including Russia, China, India and the United Arab Emirates.
The Civil Aviation Authority of Singapore, which owns Changi Airport and Changi Airports International, made an operating surplus of S$367.7 million ($251.3 million) in the 12 months to March 2007.
Liew Mun Leong, who is chairman of the Civil Aviation Authority of Singapore and also chief executive of Southeast Asia's biggest developer CapitaLand (CATL.SI), will head the new airport company as chairman, he added.
The new civil aviation authority, which will oversee functions such as air traffic services, air services negotiations, safety, and economic regulations, is to be led by Lee Hsien Yang as chairman, the minister said.
Lee, the younger brother of Singapore Prime Minister Lee Hsien Loong, is currently also the non-executive chairman of conglomerate Fraser and Neave (FRNM.SI).
Singapore had in 1997 corporatised its ports under a company called PSA International [PSA.UL], which is now a fully owned unit of Temasek.
Lim said Changi Airport's corporatisation will likely result in the hiring of people and "is not intended to be a cost-cutting exercise".
