Ascendas-Jurong International-Temasek Holdings deal combines each firm's strengths into potent force

It would create an urban planning giant in the region

Size counts. Big is beautiful. Take your choice of phrase as both apply to the dramatic news that four of the country's leading players in urban planning and development could merge.

If this ambitious deal comes off, it will, at a stroke, create one of the most powerful urban development groups in the region.

The considerable individual strengths of the four entities - business park developer Ascendas, architecture consultant Jurong International and Temasek Holdings units Surbana Group and Singbridge International - would combine into an industry colossus. It could marshal a potent combination of master planning, design and other development skills to reap huge rewards as developing nations ramp up their spending on urban infrastructure.

That is where size comes in: Governments anywhere prefer dealing with large players with the entire range of expertise at their command, when it comes to urban planning, so a multi-skilled giant will trump individual players almost every time. As Emeritus Senior Minister Goh Chok Tong said years ago, when talking about bank mergers, size helps when you are up against bigger sumo wrestlers.

Urbanisation in Asia, and the hundreds of billions of dollars it will generate in development fees, is no distant prospect. According to World Bank estimates, China's urban population may hit the one billion mark by 2030, up from approximately 731 million as at last year.

Preparing for similar shifts in other countries will generate vast potential for firms in the urban planning field, but the challenge goes far beyond just throwing a few industrial entities into one area, and homes and shops in another.

What countries, especially in Asia, want to see is how people can best live, work and play in an urban environment. In other words, how these different needs can be integrated.

It is this looming challenge - and the rewards it can bring - that is likely behind the merger talks announced late yesterday. Singapore itself is the best advertisement for such services. The country has a brand name that carries weight. Witness the many Chinese visitors impressed at how Singapore has evolved so quickly into a city that offers a comfortable working and living environment.

These merger talks set the stage to create another Singapore world-beater. Previous entities that held that lofty position are finding the going harder these days. Singapore Airlines, for example, is operating in a fiercely competitive environment.

The proposed new entity would allow four already successful firms to show increased strength in numbers, combining their skills in a complementary manner instead of operating individually.

This behemoth would certainly have the heft to take on rivals overseas, while it could well rope in Singapore's small and medium-sized enterprises and allow them to ride on the entity's expansion and growth to develop their own expertise.

While this merged entity would have the wherewithal to take on larger projects, these projects might come with more risk. To a certain extent, Singapore's involvement in various projects in China such as the Suzhou Industrial Park or Tianjin Eco-City illustrate how ambitious projects will come with their attendant risks and missteps.

Key to the success of this deal will be the eventual structure of the new entity and the determination to make it succeed.

This deal may be an arranged marriage made in heaven, but let's not pop the champagne just yet.

Let the marriage work.

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