DBS Group, the state-linked financial group, and its main subsidiary, DBS Bank, are suing international magazine BusinessWeek for comments published last year that examined trends and changes among government-linked companies.

Last week the magazine's lawyers indicated that their client would contest the case, according to a document filed with Singapore's High Court last Thursday.

According to a November 27 writ of summons - seen by the South China Morning Post yesterday - DBS Group and DBS Bank are demanding that the magazine and its publisher, United States-based McGraw-Hill, pay aggravated damages for the comments, plus legal costs.

DBS Group and its subsidiary also want the magazine served with a restraining order that prevents it from publishing the same or similar comments in future.

The DBS writ names as defendants Michael Shari, BusinessWeek''s Singapore bureau chief, and its editor-in-chief, Stephen Shepard.

The writ alleges that a September 9 article in the magazine's Asian edition - Stirring Up Singapore Inc - "injured (the plaintiffs') credit and reputation" and brought DBS Group and DBS Bank into "public scandal, odium and contempt". It added that the article was "riddled with factual inaccuracies".

The article reported on the appointment in May of Ho Ching to a powerful new role at Temasek Holdings, the government's main domestic investment agency.

Ms Ho is a high-profile businesswoman, who is also married to Deputy Prime Minister Lee Hsien Loong.

The BusinessWeek report looked at changes at some Temasek companies in the months following Ms Ho's appointment, including an ultimately abortive bid by senior executives at state-linked NatSteel to buy their own company.

The allegedly defamatory statements centre on the relationship between Temasek and DBS Group and DBS Bank. In particular, they focused on an alleged offer of loan financing to NatSteel's management for the buyout bid from the banking group.

Temasek was involved with many aspects of the drawn out battle for NatSteel, which was taken over last week by investment consortium 98 Holdings.

Temasek was a direct shareholder in NatSteel, plus an indirect shareholder in NatSteel through DBS Group. It is also an equity holder in 98 Holdings.

During the takeover battle both Temasek and DBS sold their NatSteel stakes to 98 Holdings, although there is no suggestion that either of them acted improperly.

The role played in Singapore by Temasek is a sensitive topic in the city-state.

Ms Ho's appointment also generated extensive media discussion due in part to her membership of Singapore's most important family. Mr Lee, her husband, is expected to succeed Goh Chok Tong as prime minister, while his father and Ms Ho's father-in-law, Lee Kuan Yew, is the country's Senior Minister.

Included in the Temasek stable are some of Singapore's best known companies including DBS Group, flag-carrier Singapore Airlines and defence conglomerate Singapore Technologies.

The plaintiffs' writ said that DBS Group and DBS Bank had written to BusinessWeek in September asking for a withdrawal of the statements and an apology. The magazine's lawyers replied in two letters the following month.

In the separate reply dated last Thursday, the magazine's lawyers said their clients would "deny each and every allegation made in the statement of claim" by DBS Group and DBS Bank.

DBS Group and BusinessWeek representatives did not offer separate comment yesterday.

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