Troubled Singapore observation wheel bought for $112 mn

The financially troubled Singapore Flyer, one of the world's tallest observation wheels, has been bought by a local firm for Sg$140 million ($112 million), more than a year after being put in receivership. Straco Corporation said in a filing to the Singapore Exchange its subsidiary Straco Leisure is purchasing the 42-storey high observation wheel, which at 165 metres tall (541 feet), is 30 metres higher than Britain's London Eye. It is located on a 33,700 square metre (363,000 square feet) compound in Singapore's prime waterfront Marina Bay district. Straco, which operates major tourist attractions in China including the Shanghai Ocean Aquarium and the Underwater World in Xiamen, did not specify its plans for the observation wheel. "The acquisition represents an expansion of the group's core tourism business," it said in the filing. Ferrier Hodgson, the receiver of previous owner Singapore Flyer Limited, said it will continue running the attraction for the next "two to three months" until Straco Leisure receives required government permits. Singapore Flyer Limited was a private venture backed mainly by German investors. Built by Japan's Mitsubishi Corp and Takenaka Corp at a cost of Sg$240 million, the Singapore Flyer opened to great fanfare in April 2008. Its fortunes however floundered as its novelty factor wore off and was put into receivership in May last year by creditors. Analysts say the attraction's margins have been eroded by steep discounts given to travel agents to boost passenger numbers. It was shut for a month after it broke down in December 2008, leaving passengers stranded for close to six hours in the cabins. The Singapore Flyer is sited across from the iconic Marina Bay Sands casino complex and is near the pit of the Formula One Grand Prix, a street circuit. Unlike cramped, old-style Ferris wheel carriages, which hang in the open air, the Singapore Flyer, like the London Eye, features fixed transparent "capsules" allowing a spectacular view. The Singapore wheel has 28 air conditioned capsules -- about the size of a city bus -- which can hold up to 28 people. It was the world's tallest observation wheel until March this year, when it was surpassed by the High Roller in Las Vegas, which is 2.6 metres taller at 167.6 metres. The Star of Nanchang wheel in Jiangxi, China stands at 160 metres, while the London Eye stands at 135 metres tall. The 210-metre Dubai Eye is currently being built.