Singapore mega merger could be completed by year’s endWritten by Nick Blenkey
The proposed merger of Singapore’s Sembcorp Marine and Keppel O&M is being put on a faster track. The original plan, which would have seen the creation of a combined entity, has been replaced by a simplified transaction that will see a direct acquisition of Keppel O&M by Sembcorp Marine. This will reduce the required consent and approval requirements and could reduce the time to completion by two months.
The details of the “simplified” transaction are still complex, to say the least. You can read the Keppel version of things here and Sembcorp Marine’s here.
The new transaction will still see Keppel O&M assets such as its legacy rigs transferred to Asset Co, which is majority-owned by external investors.
Without looking to closely at all the moving parts, the parties say that the revised structure and terms underscore their commitment to “establish the enlarged entity at the earliest possible time to better seize opportunities in the improving industry landscape.”
According to a report by Janice Lim in the Straits Times, “both Keppel and Sembcorp Marine are targeting to complete the proposed combination by the end of 2022, much earlier than planned.”
“The revised terms will enhance deal certainty and expedite the completion of the proposed combination, allowing Keppel to further accelerate the execution of our Vision 2030 strategy to be one integrated business, providing solutions for sustainable urbanization,” she reports Loh Chin Hua, chief executive of Keppel Corporation as saying.