Southeast Asia

Singapore Marine Companies to Merge as Downturn Weighs

 

Singapore’s Sembcorp Marine has agreed to combine with local conglomerate Keppel’s larger offshore and marine unit, a year after the Temasek-backed firms started deal talks to cope with an industry downturn.

Keppel Offshore & Marine, one of the world’s largest offshore oil rig builders, and Sembcorp Marine have suffered from a prolonged and severe sector downturn over many years.

A surge in oil prices has partly improved the industry outlook.

“The combined entity will be well-positioned to capture opportunities arising from decarbonisation in the oil and gas sector and from the global energy transition towards renewables, particularly in the areas of offshore wind, and new energy sources,” the companies said in a joint statement on Wednesday.

Once the merger is completed, Keppel and its shareholders will own 56% of the combined entity, while Sembcorp Marine’s shareholders will own the rest.

Keppel will distribute in-specie 46% of the merged entity’s shares to its shareholders and retain a 10% stake.

Singapore state investor Temasek, Sembcorp Marine’s majority shareholder, will become the largest shareholder in the combined company with a 33.5% stake. The marine company was valued at S$4.1 billion ($3 billion) as of Tuesday’s closing price.

JPMorgan is the financial adviser to Keppel on the deal, while Credit Suisse is the financial advisor to Sembcorp Marine.

 

  • Reuters, with additional editing by George Russell

 

 

READ MORE:

Singapore Press to Scrap Keppel’s Offer, Allows Rival Bid

Singapore’s Keppel Ploughs $250m into Saudi Pipeline Firm

Sumitomo and Keppel Unit Sign Deal to Develop Ammonia Fuels

 

 

George Russell

George Russell is a freelance writer and editor based in Hong Kong who has lived in Asia since 1996. His work has been published in the Financial Times, The Wall Street Journal, Bloomberg, New York Post, Variety, Forbes and the South China Morning Post.

Recent Posts

South Korea to Meet Striking Truckers as Supply Chains Suffer

The strike has seen container traffic at ports drop 19% and the country’s cement industry…

15 hours ago

Shanghai Covid Protests Break Out as Lockdowns Fury Builds

The Shanghai show of dissent comes after a deadly fire in Urumqi, the capital of China's…

16 hours ago

China Industrial Profits Slump as Economy Wilts Under Covid

Some analysts believe China's GDP could now contract this quarter and have cut their 2023…

18 hours ago

India Rocket Firm Has High Hopes Despite Low-Cost Pledge

Skyroot Aerospace says it expects to be able to launch its first satellite next year…

2 days ago

Huawei, ZTE Equipment Sales Banned by US Over Security Risks

The move is latest step in Washington's crackdown on Chinese tech giants amid fears the…

2 days ago

Covid Protests Erupt in China’s Xinjiang After Fatal Blaze

Beijing has vowed to continue with its controversial zero-Covid policy despite growing unrest and the…

2 days ago