Family Business Sharing Series 1 (2018)

华商焦点

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IN THE LEAD

PREPARING FAMILY BUSINESSES FOR THE NEW ERA With intensifying competition and accelerating changes in the market, many family businesses are facing challenges of growing their business and ensuring continuity in the market. The sharing session focused on how family business can maximise their values, options to access capital funding as well as other business succession issues.

In the family business sharing session organised by SCCCI in partnership with PwC and UBS, the speakers shared their insights on how family business could adapt to the changing business environment. Panelists included Alun Braniga, Head of Corporate Finance APAC, UBS Wealth Management; Ng Siew Quan, Asia Pacific Entrepreneurial & Private Clients Leader, PwC Singapore, and Chairman of SCCCI’s Research & Publications Committee, SCCCI; Kuah Boon Wee, Chairman of MTQ Corporation and SCCCI Vice-President; and Ng Aik Ping, Director of Family Advisory Asia Pacific, UBS. SCCCI Vice-President Charles Ho delivered his opening remarks and encouraged family businesses to promote succession. He said that family businesses are highly relevant to the Chamber, as many members of the Chamber are family businesses which are undergoing transition from the second generation to the third. Many are also from traditional industries that need to transform, to adapt to economic restructuring and rapid changes in the business environment.

FORMULATING THE IDEAL STRATEGY FOR FUTURE OWNERSHIP

In his presentation titled “Facing the Future: Working with External Capital to Ensure Multi-Generational Continuity”, Alun Braniga from UBS Wealth Management shared that the major challenges for family businesses today are growth, disruption and succession, reasons including harder access to talent, reshoring trends, disruptive technology, more transparent pricing, rapid changes of consumer taste, amongst others. To ensure sustainability, he suggested that the key leaders of family businesses could reflect on the following:

“THERE IS NO RIGHT AND WRONG ANSWER IN USING EXTERNAL CAPITAL, THE BUSINESS OWNER MUST DECIDE WHAT IS RIGHT FOR THE BUSINESS.”

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Do you make all the key decisions?

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Are most of the sales through your relationships with customers?

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Do you negotiate personally with your key suppliers?

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Who understands the operational processes of the business better than you?

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If you stopped tomorrow do you know who would take over? Do they know?

Alun continued to share with the audiences three strategic options of family business on future ownership

Alun Braniga Head of Corporate Finance APAC, UBS Wealth Management

How long a holiday could you take away from the company?

华商焦点

IN THE LEAD

19

(From left) Alun Braniga, Head of Corporate Finance APAC, UBS Wealth Management; Ng Siew Quan, Asia Pacific Entrepreneurial & Private Clients Leader, PwC Singapore, and Chairman of SCCCI’s Research & Publications Committee; Kuah Boon Wee, Chairman of MTQ Corporation and SCCCI Vice-President; and Ng Aik Ping, Director of Family Advisory Asia Pacific, UBS.

planning, which are “focus”, “diversify” and “sell”. According to their specific situations and objectives such as maximisation of value, exposure to future value, transparency of business, and keeping future flexibility, businesses can choose their own strategy. And with the direction in mind, businesses can move to more concrete steps on ownership management such as making minority growth capital investment, initial public offering (IPO), strategic partnership, sale of majority stake, or complete sale of the business. The business will also be able to choose wisely the type of investors that they need, among strategic partners, financial sponsors and stock market investors.

business. In his business, while he enjoyed the fact that he no longer needed to attend meetings that were not worthwhile, he conceded that running the family business is also much more pressurising than the corporate world, especially when the oil industry went into a low period – MTQ is an engineering solution provider of the industry.

“A CORPORATE MAN TURNS HIS IN-TRAY TO OUT-TRAY. RUNNING A FAMILY BUSINESS MEANS I HAVE TO GENERATE MY OWN OUT-TRAY, AND TAKE A LONG-TERM VIEW.”

“There is no right and wrong answer in using external capital, the business owner must decide what is right for the business.”

Kuah Boon Wee Chairman of MTQ Corporation and SCCCI Vice-President

FROM PROCESSING IN-TRAY TO GENERATING OUT-TRAY

Kuah Boon Wee, Chairman of MTQ Corporation shared how he felt after leaving his position as the Chief Executive Officer of Middle East South Asia at PSA International Pte Ltd (Port of Singapore Authority) and taking over the family

“A corporate man turns his in-tray to out-tray. Running a family business means I have to generate my own out-tray, and take a long-term view.”

Despite the pressure, he also appreciates the beauty of the family perspective, which is that one has to take a long-term view. “If you are taking a short-term view, you can exit the sector and come back later on, but with family perspective you can’t do that.”

Closing the session, Ng Siew Quan, equipped with 25 years of experience in business consultancy, reminded us that family businesses often fail for family reasons instead of business reasons, and that family businesses can actually be professionalised.