By Anita Gabrielanitag@sph.com.sg@AnitaGabrielBT

Singapore

SINGAPORE prosecutors are likely topress new charges against former BSIbanker Yeo Jiawei, who has alreadybeen charged with seven offencesranging from money laundering, for-gery and cheating to obstruction ofjustice, as a result of an ongoing mas-sive probe by authorities here into1Malaysia Development Berhad, thecourt here heard on Thursday.

Second Solicitor-General KwekMeanLuck told the state court that in-vestigators are scrutinising other as-pects of the transactions involvingcriminal offences related to the sev-enth charge where Yeo has been ac-cused of forging documents to facili-tate a transfer of US$11.95 million in2013 from SRC International (Malay-sia) Ltd to a firm beneficially ownedby Tan Kim Loong, a close associateof Malaysian businessman Low TaekJho, better known as Jho Low.

“A furtherperiod of remand isnec-essary as it would allow for ongoinginvestigationintothenewlinesofcrit-ical enquires that have opened upsince the tendering of the seventhcharge,” said Mr Kwek at the sixthmention of Yeo’s case where he said

the prosecution is not expected toseek further remand beyond twoweeks from now and is instead likelyto apply for Yeo to be denied bail.

As in previous mentions, Yeo ap-peared in court via video link. MrKwek reiterated Yeo’s key role in thelast three years in relation to illicittransactions and money flows in andout of Singapore, pointing out thatthe investigations (into the 1MDBmoney trail) were vastly differentfrom other serious crimes such asdrug trafficking or murder which of-ten involved a singular transaction or

act.This investigation involvedmulti-ple, complex, cross-border financialtransactions,multipleentitiesandex-tensive documentation, he said.

“Indeed, we have just ascertainedthat the accused has told yet anotherindividualwithknowledge of some ofthesequestionable transactions tode-lete all relevant emails and to makehimself unavailable for questioningby the CAD,” said Mr Kwek, addingthat Yeo may have likely told othersas well to “suppress and tailor” infor-mation.

“A few new witnesses were inter-

viewed since last week and some wit-nesses have been recalled for inter-views,” said Mr Kwek.

Yeo’s lawyer Philip Fong of HarryElias Partnership submitted thatthere is no further evidence that canbe obtained from the accused as heclaimed that the prosecution “alreadyhas all the evidence they need”.

“There is nothing else the accusedcan say which has not been said al-ready. The accused should be re-leased on bail and be allowed to startpreparing his defence in advance ofhis trial,” Mr Fong added.

District Court Judge ChristopherGoh ordered Yeo to be remanded tillMay 24 but said he was unable to sayif thecourtwouldgrantanyfurther re-mand request and asked the prosecu-tion to prepare its submission to de-ny Yeo bail at the next mention.

Pointing out that Yeo, 33, has beenremanded for one month and fourdays and that this was the sixth re-mand application by prosecutors, thejudge said the onus on the prosecu-tion to apply to further remand Yeowould be more onerous to ensure abalance is struck between the interestof the state and the accused.

The prosecution also said it nolongerobjects toprovidingYeosuper-vised access to his wife as investiga-tions on her have “progressed”.

By Jamie Leeleejamie@sph.com.sg@JamieLeeBT

Singapore

SINGAPORE Technologies Telemedia(ST Telemedia) is bulking into one ofthe largest homegrown data centreplayers in Asia with its latest pur-chase from India’s Tata Communica-tions. The deal ties the firm moreclosely with tech giant Amazon.

It said on Thursday it has snaggeda 74 per cent stake in TataCommunications’ data centre busi-ness in India and Singapore – a busi-ness valued at about US$640 million.

The Business Times understandsthat this will allow ST Telemedia toovertake Equinix this year in terms ofmarketsharefordatacentres inSinga-pore, though it is still snapping at theheels of market leader, SingTel.

The latest acquisition will have STTelemedia controlling 14 data cen-tres in India and three in Singapore.Tata Communications will keep theremaining 26 per cent stake.

This comes as ST Telemedia hasbeen wooing Amazon Web Services(AWS) – Tata’s anchor client – to growtheir cloud business in STTelemedia’s new data centre, saidLynus Pook, associate director, datacentre advisory group, Cushman &Wakefield Singapore.

This deal would “naturally create aloop around the AWS business mod-el”, he said. “It is a big win for ST Tele-media,” added Mr Pook, saying that itis possible ST Telemedia will next tar-get Japanese data centres.

The companies did not identifyAmazonasamong its clients,but saidits customers include e-commerceplatforms. Christine Li, director of re-search at Cushman & Wakefield, saidtheacquisitionwill turnSTTelemediainto one of the largest home-growndata centre players in Asia.

“ThisallowsSTTelemediatoquick-ly establish presence in India withoutgoing through the long developmentphase from acquiring suitable sites tofit out the data centres, as most of the

assets are already tenanted,” said MsLi. “We believe the data centre marketwill still grow by double digits interms of market value over the nextthree to five years in the Asia Pacificregion.”

ST Telemedia made its first invest-ment in the data centre business inmid-2014. It acquired then a 40 percent stake for an undisclosed sum inGDS Services (GDS), which has morethan 15 data centres across Chinaand Hong Kong, and offers managedIT services, hosting services, andcloud computing infrastructure.GDS’s clients included major nationaland international financial institu-tions, large enterprises, governmentagencies, and large Internet compa-nies.

In 2015, ST Telemedia acquired a49 per cent stake in UK’s Virtus DataCentres, for an undisclosed sum. Inthe same year, ST Telemedia andStarHubsaidtheywould jointlydevel-op data centre MediaHub. ST Teleme-dia invested about S$36.9 million for

a 70 per cent stake in Shine SystemsAssets, which holds MediaHub.

“The latest addition of India to theSTT GDC (ST Telemedia Global DataCentres)networkwillbeamajor impe-tus to advance the company’s ambi-tiontobeasignificantglobaldatacen-tre service provider,” said Sio Tat Hi-ang, executive director at ST Teleme-dia, in the press statement.

Tata Communications will now fo-cusonthedevelopmentandintroduc-tion of its advanced managed ser-vices portfolio that would include In-ternet protocol or IP, cloud enable-ment, and unified communicationsservices, according to the press state-ment. It will also continue to invest inits strategic partnerships globally.

“This new joint venture partner-ship will now allow us to hone ourstrategic focus on advanced serviceswithin the datacentre thatenable dig-ital transformation for our custom-ers, in addition to infrastructure ser-vices,” said Vinod Kumar, CEO, TataCommunications, in a statement.

By Andrea Sohsandrea@sph.com.sg@AndreaSohBT

Singapore

WHILE consumption of steel in Chinawill continue to grow into the nextdecade, demand for iron ore will fallas the country turns to using morescrap in its steel production, accord-ing to BHP Billiton, one of the largestiron ore exporters in the world.

At the Singapore Iron Ore Week fo-rum on Thursday, BHP Billiton vice-president of marketing Vicky Binnssaid that the group remains positiveon China’s steel consumption till themiddle of the next decade.

Steel inventory in China, the larg-est producer and consumer in theworld, significantly lags behind thoseof developed countries, and is onlyhalf of the levels in the US currently.“We believe it will continue to buildup stock in steel for sustainable eco-nomic growth,” Ms Binns said, addingthat steel demand will also be sup-ported by infrastructure spending onhighways, railways and airports.

Butgrowth in ironoredemandwillnot necessarily follow, she added.

As the availabilityofscrap increas-es, more will be recycled and it willtake up a bigger proportion of steelmaking. “China will likely promotemore scrap usage substituting pigiron, which uses iron ore,” she said.“We will see a decoupling in pig irongrowth rate and crude steel growthrate, translating into lower demandfor iron ore.”

According to price reporting agen-cy Platts, about 10 per cent of China’scrude steel production came fromscrap last year. The country imported953million tonnesof ironore,or two-thirds of global trade, last year, saidZheng Chao, minister counsellor foreconomic and commercial office ofChina Embassy in Singapore.

China’s shift towards environmen-tally-sustainable practices as it fightsagainst pollution will also lead to thecountry using larger, more efficientand more environmentally-friendlyblast furnaces, said Ms Binns. Thesefurnaces will require higher-qualityrawmaterials suchas ironore lumps.

Iron ore lumps, unlike fine ironore products or concentrates, do nothave to be treated first before beingfedintothefurnace.TheSingaporeEx-change, which currently clears over90per centof globally traded ironorederivatives, in August last yearlaunched iron ore lump premiumswap and futures contracts. But vol-umes for these still lag far behindthose of its established contract forore of 62 per cent content.

BHP Billiton’s view on China’s steeldemand remaining strong, even asgrowth in its services sector outpacesthat of industrial production, is sup-portedbyat leastoneothermajorpro-ducer.

Asked during a panel discussion

whether he thinks the country’s pivottowards a consumption model ofgrowth compared to the export-ledgrowth it used in the past will lead toa drop in steel demand, FortescueMetals Group’s business develop-ment manager Zhuang Binjun said:“Not necessarily.” Higher consump-tion levels translate to more cars be-ing bought, he said. With the Chinesealso expected to travel more, thismeans more railways, airports androads will be built, supporting de-mand for steel, he added.

Industry players said during thesame panel discussion that the pricerebound that has been seen in theiron ore price so far this year will notbe sustainable. “The high price is nota desirable situation for removing ca-pacity,” said Baosteel Group Corpora-tion deputy general manager ZhangDianbo, though he does not foreseeiron ore prices falling to the seven-year lows of below US$40 a tonneseen in December last year.

Concurring,TataSteelgroupdirec-torof procurement is forecasting ironore prices to fall over the next fewyears. “Fundamentals are fundamen-tals,”he said. “We’re notgoing tosee avery optimistic scenario for the nextcouple of years.”

At the event, Minister for TradeandIndustry (Industry)S Iswaransaidthat Singapore will need to create theinfrastructureessential tostrengthen-ing the Republic’s position as a globaltrading hub in the long term.

The National Trade Platformwhich was announced in the govern-ment budget this year is part of this,and will be a one-stop informationplatform for the trade and logisticssectors. “By enabling digital informa-tionexchange, companies will beableto share and re-use secure docu-mentswith businesspartners and thegovernment seamless,” said MrIswaran. “Traders will be able to tapon an expanded international net-work to facilitate collaboration andunlock business opportunities.”

By Tan Hwee Hweehweetan@sph.com.sg@HweetanBT

Singapore

ANY Singaporean visiting Iran has to go through alengthy visa application. This takes about twohours on the standard queue and one hour or lesson fast-track priority at a surcharge. That processputs a Singaporean on arrival in the country imme-diately at a disadvantage compared to a Malaysianwho gets to walk in without any hassle.

Thevisaapplicationis justoneamongmanyoth-er transaction costs that Singapore businesses pur-suing opportunities in the hydrocarbon-rich Mid-dle Eastern country have to grapple with.

It also spells one additional hurdle to overcomein levelling up the playing field against Islamiccountries that can count on friendly ties with Iran.

But the untapped wealth of commodities alonein Iran – oil and gas as well as agriculture – contin-ues to attract more Singapore business leaderskeen to have an early leg up in establishing tieswith local partners before the remaining sanctionsare lifted against the country.

In early May, a business delegation comprisinglarge and small-cap listed companies in SingaporevisitedTeheran towards theendof the large Iranoilshow. This was two months after a visit by TradeandIndustryMinisterS Iswarananda57-strongSin-gaporeBusinessFederation-leddelegationcompris-ing representatives from 48 companies.

The oil show was touted to have drawn over1,800 participating exhibitors, including at leasttwo Singapore-based players: small-cap listedcom-pany Kim Heng Offshore & Marine Holdings, andprivately owned Tristar Industries. Also flocking toIran’s largest oil show was a separate delegationfrom Malaysia External Trade Development (Mat-rade). Matrade took up an exhibition booth.

One long-time Iran observer told BT the compo-sition of the 2016 Iran oil show was far more geo-graphically diverse compared to the 2015 edition,whichwasover-representedbyexhibitorsfromChi-na. The event organiser claimed to have attractedexhibitors from 40 countries from five continents.

South Korean President Park Geun Hye was ahighlight during the oil show week. Leading over230 business executives, Ms Park’s visit reportedlywitnessed the signing of upwards of US$10 billionin agreements between South Korea and Iran.

Whatraisedeyebrows in thebusinesscommuni-ty here was that, among the bilateral agreements

signed during Ms Park’s visit, was a five jack-updeal involving South Korea’s top shipbuilder, Dae-woo Shipbuilding & Marine Engineering (DSME).

Official details of the jack-up construction dealare sparse, feeding speculation that this may havebeen just a diplomatic gesture. Offshore & Marinesources monitoring the development also pointedto a high level of local content ranging from the up-per 50s to 80 percentile, raising further questionson the deliverability of the agreement.

Many visiting oil-and-gas professionals noted,however, that Iran has proven to be a lot moreself-sufficient than expected. Yards in Iran have at-tempted before to build their own rigs, including adeep-water semi-submersible drilling unit. One Ira-nian yard player was touting its in-house jack-uprig design that was classified by Korean Register ofShipping at the oil show.

A Singapore-based oilfield services player de-scribed the oil show as an eye-opening experienceto Iran’s capabilities. The industry player told BTthat the company had decided to channel its re-sources towards offshore instead of onshore oiland gas projects.

But Iran isalso seeking toboostefficiencies, andwhat industry players there are seeking is financialsupport and technology transfer. Some question ifIran may be overstating the promise of its oil-and-gas sector given the country needs US$100 billionof foreign direct investment to press ahead withthe reported US$130 billion of upstream oil andgas projects in the next few years.

Iran also craves technology that will help scalethe value chain. Oilfield services contractors in thecountry are hungry for alternatives to Chineseequipment that has flooded the market throughyears of international sanctions.

To safeguard the interests of local industries,however, Iran is learning from the example of Bra-zil and looking to regulate or legislate local contentrequirements, one government official told BT atthe oil show.

BT understands foreign participation in Iran’soil and gas tenders will be restricted to joint ven-tures with local entities approved by the respectiveregulatory bodies, to enable them to ensure the de-sired percentage of work to be carried out locally.

The official hinted to BT that Iran may not belooking to impose prescriptive local content re-quirements that have contributed to cripplingprogress in Brazil’s oil and gas sector. Instead, theMiddle Eastern country, in drawing lessons from

Brazil’s experience, is considering a “fine-and-re-ward”systemtosteer thegrowthof itsdomesticoil-field services sector.

Many listed oilfield services players here haveexpressed hesitation about moving into Iran partlybecause the country’s oil and gas-related policies –including its local content demand – are still evolv-ing. A related concern is a lack of information tosupport selection of local partners.

There are also nudging doubts about how mon-eycanbe transferred in and outof the country, andwhether business insurance adequately backed byinternational names can be procured.

But these may be considered secondary to thegeopolitical risks of doing business with a nationthat carries enormous geopolitical baggage. The USsanctions have yet to be fully lifted not just againstIran but also some (if not all) of its national oil com-panies. A bigger threat, however, to the livelihoodofany oilfield services contractor is the long-stand-ing animosity between Saudi Arabia and Iran. Oilcompanies fromSaudiArabia (andevenAbuDhabi)have hinted that no oilfield services player will fea-ture “prominently” concurrently in their homecountries and Iran, a Singapore-listed offshore sup-port vessel player told BT.

In view of these downside risks, large-cap listedoffshore and marine companies in Singapore ap-pear tobetaking it slowinventuring into Iran. Evenamong the small-cap listed players, only Kim Henghas officially declared its intent to enter Iran, hav-ing penned a memorandum of understanding foran investment of up to 400 million euros (S$620million) in oil and gas projects there.

For all its downside risks, the vast potential ofIran’soil and gas sector remains ahuge draw to for-eign investors.

National Iranian Oil Co aims to produce 1,400millioncubic metresperday of natural gas,4.7mil-lion barrels per day of crude, and one million bar-rels per day of condensate by 2020. This involvesthe development of 21 oilfields and 22 gas fields orformations, and the drilling and workover of 2,681oil and gas wells.

National Petrochemical Co is targeting to morethan double the country’s petrochemical produc-tion to 123 million tonnes per year (mtpy) by 2020from 59 mtpy in 2016. Exports of petrochemicalproducts are expected to increase to 65 mtpy by2020 from 23 mtpy.

It is thus little wonder that hotels in Iran werepacked to the brim during its annual oil show.

ST Telemedia buys 74% of TataComm’s data centre business

Former BSI banker likely to face new charges

BHP sees China steeldemand to stay firmbut not for iron ore

NEWS ANALYSIS

Weighing the ups and downs of entering Iran

Yeo Jiawei has already been charged with seven offences ranging frommoney laundering, forgery and cheating to obstruction of justice as aresult of the ongoing probe into 1MDB. PHOTO: REUTERS

As the availability of scrapincreases, more will be recycledand it will take up a biggerproportion of steel making in China

The deal ties the Singapore firm more closely with tech giant Amazon

G8 Education Limited(Incorporated in the Commonwealth of Australia)

(ACN 123 828 553)(the “Company”)

NOTICE TO HOLDERS OF THEOUTSTANDING S$260,000,000 4.75 PER CENT.

FIXED RATE NOTES DUE 2017(ISIN: SG6QC9000008) (THE “NOTES”)

ISSUED BY THE COMPANY PURSUANT TO THES$600,000,000 MULTICURRENCY

DEBT ISSUANCE PROGRAMME (“PROGRAMME”)

NOTICE OF REDEMPTION

Reference is made to the Notes which are constituted bythe Trust Deed dated 2 May 2014 entered into between(1) the Company, as issuer, and (2) DBS Trustee Limited,as amended, modified and supplemented by the FirstSupplemental Trust Deed dated 26 April 2016 and the SecondSupplemental Trust Deed dated 19 May 2016. Capitalised orother terms but not defined herein shall, unless the contextotherwise requires, have the meanings as set out in theinvitation memorandum dated 26 April 2016 (the “InvitationMemorandum”) issued by the Company.

NOTICE IS HEREBY GIVEN by the Company, pursuantto Condition 6(j) of the Notes, of its intention to redeem all(but not some) of the Notes outstanding on 27 May 2016 ata redemption price equal to 101.50 per cent of the principalamount of the Notes, together with interest accrued up to(but excluding) the date fixed for redemption.

The Company shall make or cause to be made payment ofthe redemption moneys in respect of the Notes in accordancewith the Conditions.

20 May 2016For and on behalf of G8 Education Limited

ENDSChris ScottManaging Director

4 | TOP STORIESThe Business Times | Friday, May 20, 2016