Temasek in $3bn Keppel bid

Temasek’s attempt to take control of Keppel comes as the Singapore state investor continues to consolidate its hold on the Asian maritime industry. (Reuters)
Updated 22 October 2019

Temasek in $3bn Keppel bid

  • Offer sparks industry shake-up talk in rig sector, sending shares upwards despite oil price slump

SINGAPORE: Temasek Holdings is offering to buy control of Singapore conglomerate Keppel Corp. in a S$4.1 billion ($3 billion) deal that could spark consolidation in the domestic rig building sector that is battling the effects of low oil prices.

The announcement, confirming what sources told Reuters on Monday, boosted shares in rig builder Sembcorp Marine by 12 percent on expectations of a likely shake-up in the industry.

On Tuesday, shares rose a further 2.2 percent, while shares in parent Sembcorp Industries were steady after rallying 10 percent in the previous session.

Keppel’s offshore and marine unit, and Sembcorp Marine, the two local players, have been hit by a prolonged downturn in the global sector in the last five years as oil prices tumbled.

“There has long been talk of a potential restructuring of businesses under the Keppel Corp. and Sembcorp Industries stable such as the merging of the offshore & marine yards,” said Low Pei Han, senior research analyst at the Bank of Singapore. 

Keppel is involved in rig-building, property development, infrastructure and investments

Singapore state investor Temasek said if the deal is completed, it would work with Keppel’s board to undertake a strategic review of its businesses. The deal is its biggest since a $3.7 billion minority stake investment it made in Germany’s Bayer in April 2018.

Temasek already owns 20.5 percent of Keppel and said it would increase that stake to 51 percent, subject to regulator approvals.

An indirect fully-owned subsidiary of Temasek will offer S$7.35 in cash for each Keppel share, a premium of nearly 26 percent over Friday’s S$5.84 close. 

Keppel’s shares soared 15.7 percent to S$6.77 on Tuesday, below Temasek’s offer of S$7.35.

“The partial offer reflects our view that there is inherent long-term value in Keppel’s businesses, notwithstanding the challenges presented by the current business and economic outlook,” Tan Chong Lee, president of Temasek’s investment arm, said in the statement.

 


Saudi companies display latest technologies at Dubai Airshow

Updated 17 November 2019

Saudi companies display latest technologies at Dubai Airshow

DUBAI: Over 25 Saudi companies and government institutions are taking part in the Dubai Airshow hoping to snag deals for their latest defense and aviation technologies being showcased at the biennial event.

The Middle East’s biggest aviation gathering opened on Sunday sans major announcements for big-ticket aircraft purchases from Gulf flagship carriers, maybe also due to dozens of deals already been previously signed and the planes just waiting to be delivered.

Among the major Saudi companies in the event include the Saudi Arabian Military Industries (SAMI), fully owned by the Public Investment Fund, which has operations from aeronautics, land systems, naval systems, weapons and missiles and defense electronics.

SAMI aims to become among the top 25 companies globally by 2030 and to localize military spending, in line with the Kingdom’s vision.

Among other notable Saudi companies and institutions with a presence at the airshow are Saudi Airlines, flynas, The General Authority of Civil Aviation and the King Abdulaziz City for Science and Technology.

Meanwhile, Saudi INTRA Defense Technologies signed a Memorandum of Agreement with multinational defense company Hensoldt for the co-development and co-production of advanced electro-optic systems, as well as a joint venture agreement with EM&E for the transfer of technology and localization of the precision mechanical industries in the Kingdom.

ESEN Saudi, a hi-tech defense and aerospace engineering and production company, was also launched at the Dubai Airshow’s opening day.

Middle East Propulsion Company, which specializes in maintenance, repair and operations (MRO) for the Middle East, was also one of the Saudi companies on site. The company, which boasts of a workforce comprised of Saudi nationals of about 80 percent, aims to expand their services across the GCC and wider Middle East region.

Al-Salam Aerospace Industries meanwhile has on display latest advancements in the manufacture of key components for the F-15 fighter jet.