Billionaires: Singapore doctor fighting Covid pandemic boosts personal wealth to $1.1bn

In our fortnightly roundup, US banker Byron Trott quietly amasses a $3.6bn fortune and Howard Lutnick plans to create a new futures exchange

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A Singapore doctor has joined the ranks of billionaires after his company became involved in efforts to fight the Covid-19 pandemic, helping send its profit and stock surging.

Loo Choon Yong, executive chairman of Raffles Medical Group, is now worth $1.1 billion, according to the Bloomberg Billionaires Index, as the health care provider’s net income more than doubled in the first half of this year and its shares climbed 104 per cent from a low in March 2020.

Raffles Medical has been operating 15 vaccination centres in the city-state, and helping with air-border screening, pre-event testing and pre-departure swabbing of cruise passengers. It’s the latest example of how businesses adapted during the coronavirus outbreak when other lines of work were hit.

“When the country is facing a challenge like this, we have to help out,” Dr Loo, who owns about 52 per cent of Raffles Medical with his family, said in a video interview. “Although we’re private, we’re part of the healthcare system.”

Singapore has been speeding up its Covid-19 vaccination drive, expecting to have 80 per cent of the population fully inoculated by September so it can relax more virus curbs, including starting to allow quarantine-free travel. Raffles Medical, which operates more than 60 clinics and practices and one hospital across the country, began working on the efforts in January.

“The fact that Raffles Medical is one of the largest health care providers in Singapore meant that they were able to assist in more ways than one,” said Wee Kuang Tay, an analyst at CGS-CIMB Securities Singapore. Their involvement “has benefited them”, he said.

Dr Loo, 72, co-founded Raffles Medical in 1976. He and his friend, Alfred Loh, initially bought two clinics and gradually built the company. As well as its presence in Singapore, Raffles Medical has three hospitals in China and also operates in Japan, Vietnam and Cambodia.

“The principle was to look after patients properly,” Dr Loo said. “The business will look after itself. That’s how we grew over the years.”

Things didn’t look so bright when the virus started to spread last year. Raffles Medical’s regular business declined as people stayed away from clinics and hospitals, and medical providers were only allowed to provide essential services, according to Dr Loo.

“During the Covid period, patients get worried and try to stay home,” he said. “You don’t want to go for health check-ups and pick up Covid.”

So the company deployed doctors, nurses and other staff into areas such as Covid-19 testing and screening at airports.

Raffles Medical reported profit after tax of 38.8 million Singapore dollars ($28.7m) for the first half of this year, up 138 per cent from the same period a year earlier. Revenue rose 42 per cent to 343.8m Singapore dollars.

The company’s shares have climbed 50 per cent so far this year, compared with a 12 per cent gain for the country’s benchmark stock index.

Dr Loo, meanwhile, said amassing a fortune of more than $1bn isn’t how he judges his success.

Byron Trott

Byron Trott, adviser to some of the world’s wealthiest families, doesn’t like being called the billionaires’ banker.

How does billionaire banker sound? The 62-year-old founder of BDT Capital Partners has quietly amassed a $3.6bn fortune, according to the Bloomberg Billionaires Index, making the former Goldman Sachs executive as wealthy as some of his better-known clients.

Born in a small town in Missouri, the son of a telephone line repairman and dress shop owner, Mr Trott laid the foundations by initially advising some of the world’s most successful investors, especially Warren Buffett, during an almost three-decade run at Goldman Sachs. Since leaving in 2009, he started his own Chicago-based advisory and private equity firm, where assets have rapidly swelled to $28bn.

One of his company’s first investments, Weber, went public this week. While BDT is the grill-maker’s majority owner, Mr Trott and his family personally own a 5 per cent stake worth $240m, according to a regulatory filing. Weber was a typical BDT investment: family owned and often founder-led. Other investments include Whataburger Restaurants, Cox Automotive and German car parts manufacturer Schaeffler.

BDT’s model – pitching advice and investing its own capital – is in many ways a throwback to old-world merchant banks. It’s also one that can be phenomenally lucrative for the founders.

“I think of BDT’s purpose being to serve and add value to their clients, and their clients are largely family-run businesses,” said Tom Pritzker, a Trott client for decades and chief executive of the Pritzker Organisation. “If they do that well, if they add value to those family-run businesses, the consequence will be profit.”

Mr Trott made a name for himself orchestrating a series of deals for Mr Buffett’s Berkshire Hathaway, prompting the Omaha billionaire to praise him in a letter to investors.

“He understands Berkshire far better than any investment banker with whom we have talked and – it hurts me to say this – earns his fee,” Mr Buffett wrote in 2004.

In 2008, Mr Trott pulled off one of the most consequential deals in modern Wall Street history, negotiating Berkshire’s $5bn investment in Goldman Sachs during the peak of the financial crisis, helping shore up the bank’s capital base and restore market confidence.

His Rolodex, though, extended far beyond Mr Buffett. The Waltons, Kochs, Wrigleys and Pritzkers have all been linked to Mr Trott, and many of these dynasties have invested in BDT’s funds, sold parts of their business to the private equity firm, or both.

Since the Weber deal was struck in 2010, the firm’s assets under management have grown to about $28bn at the start of 2021, just shy of the $32bn managed by Bridgepoint Group, which went public last month at a valuation of about $4 billion.

Mr Trott owns at least 50 per cent of BDT, according to the Bloomberg wealth index, and is estimated to have more than $1.7bn personally invested in its funds.

Howard Lutnick

Howard Lutnick shook up Treasuries trading in the 1990s, and now he wants to take another crack at it, this time in the market for futures linked to US government debt.

The billionaire, speaking at a recent BGC Partners' earnings conference call, said he plans to create a futures exchange to take on CME Group’s dominant franchise for interest-rate derivatives. Mr Lutnick is chairman and chief executive of BGC, a broker affiliated with Cantor Fitzgerald.

Mr Lutnick launched eSpeed in 1996, helping to fuel an electronic trading revolution in Treasuries. Nasdaq bought the business in 2013, but after his non-compete expired, Mr Lutnick created a new market for trading Treasuries called Fenics. So far, it’s only been a venue for the bonds themselves, not the futures contracts that account for a huge chunk of the industry’s trading.

“We have been talking to our customers and clients and we think we’ve got a great reception and are very excited about the opportunity to create a competitor to the Chicago Mercantile Exchange’s monopoly in rates futures,” he said.

Quote
We think we’ve got a great reception and are very excited about the opportunity to create a competitor to the Chicago Mercantile Exchange’s monopoly in rates futures
Howard Lutnick, chairman and chief executive of BGC Partners

“We will have broad support from those players,” he added. “In what forms and exactly how, I look forward to updating you next quarter.”

CME declined to comment. Mr Lutnick is already a rival of CME, which owns BrokerTec, one of the largest venues for trading Treasury securities.

Mr Lutnick faces long odds, based on history – including his own. Once an exchange gets momentum in a particular futures market, it’s been difficult to dislodge.

Eurex, a major derivatives exchange in Europe, started a US market in 2004 but never got traction and closed it in 2008. ELX Futures LP – created by Wall Street giants including Mr Lutnick, JPMorgan Chase and Citigroup – began offering Treasury futures more than a decade ago, but failed to put a dent in CME’s rates business.

Updated: August 15th 2021, 8:06 AM
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