Keppel Corporation Limited (the Company or Keppel) announced Friday that KSI Production Pte Ltd (KSI), an indirect wholly-owned subsidiary of the Company, has on Sept. 4 entered into a sale and purchase agreement to acquire 50 ordinary shares (Acquired Shares), representing 10 percent shareholding interest in the total registered issued share capital of Golar Hilli Corporation (Golar Hilli) from Golar GHK Lessors Limited (Golar GHK) at a consideration of $1 per Acquired Share (the Acquisition).
Golar Hilli is the owner of the Moss LNG carrier HILLI which, as announced July 3, is scheduled to be converted into a Floating Liquefaction Vessel (FLNGV) by Keppel Shipyard Limited, another wholly-owned subsidiary of the Company. Both Golar GHK and Golar Hilli are subsidiaries of Golar LNG Limited, with Golar GHK currently being the sole shareholder of Golar Hilli.
The Acquisition strengthens the alignment of strategic interests between Keppel Shipyard Limited and Golar LNG Limited, and reflects Keppel's confidence in the prospects of Golar Hilli, the world's first FLNGV conversion project. The Company also believes that this investment will provide an attractive risk-adjusted return.
The aggregate cash consideration of $50 was arrived at on a willing buyer willing seller basis, taking into account the book value and net tangible asset value of the Acquired Shares, being $50 as at Sept. 1, and was funded through the internal working capital of KSI. As part of the Acquisition, KSI will also be extending a shareholders' loan of $21,688,029 to Golar Hilli, representing 10 percent of the total amount of shareholders' loan extended to Golar Hilli, taking into account Golar Hilli's capital expenditure.
The Company will make a further announcement upon completion of the Acquisition (Completion).
In connection with the Acquisition, KSI has on the same day also entered into a shareholders' agreement with Golar GHK and Golar Hilli which will take effect upon Completion. The shareholders' agreement governs the relationship between Golar GHK, Golar Hilli and KSI with respect to the conduct of the business to be undertaken by Golar Hilli, which includes seeking opportunities, and entering into agreements, with respect to the deployment and use of the HILLI for natural gas liquefaction projects. Under the terms of the shareholders' agreement, Golar Hilli may issue cash calls on a pro rata basis to shareholders for future funding requirements for the construction, deployment, and commissioning of HILLI based on the anticipated budget limit of $1.3 billion including contingency.
None of the directors or controlling shareholders of the Company has any interest, direct or indirect, in the above transaction.
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