Total consideration for the assets is RMB 45m (S$ 9m) in cash which was arrived at on a willing buyer and willing seller basis, at a discount to the latest available valuation of the assets commissioned on behalf of the sellers. An advance payment of RMB 3m will be made following the signing of the agreement and the balance will be paid after obtaining approvals from relevant authorities.
The facility will be named Keppel Nantong Shipyard, and is expected to be operational by third quarter of 2005. Its principal activities will be in the engineering and construction of specialized vessels such as Anchor Handling Tug/Supply (AHTS) vessels and tugboats.
Mr. Charles Foo, Chairman of Keppel Singmarine and Managing Director/Special Projects of Keppel O&M, said, "Keppel Nantong Shipyard will boost our newbuilding capacity to meet increasing demand for specialized vessels to serve the offshore field development market and growth in LNG terminals and maritime ports.
"Nantong has a skilled marine workforce. With good management and effective project control, we are confident that Keppel Nantong Shipyard will build on Keppel O&M's brand equity of a Can Do! attitude, delivering quality products and services on time and within budget."
Keppel Nantong Shipyard is located along the Yangtze River, within close proximity to supporting industries in the Municipality of Nantong, 100 km north-west of Shanghai.
The above transaction is not expected to have any significant impact on the net tangible asset per KCL share or the earnings per KCL share for the year ending 31 December 2005.
Keppel Singmarine is one of the world's leading builders of small to medium-sized customized vessels including Anchor Handling Tug Supply (AHTS) vessels, multipurpose support vessels and cable ships. ISO 9001 certified, it utilizes leading-edge marine technologies in its activities.
A wholly-owned subsidiary of Keppel Corporation, Keppel O&M is the global leader in offshore rigs and shiprepair and conversion as well as a specialised shipbuilder. Its near market, near customer strategy is bolstered by its wide global network of shipyards in the Asia Pacific, Gulf of Mexico, Brazil, the Caspian Sea, Middle East and the North Sea regions. Integrating the experience and expertise of its yards worldwide, the group aims to be the provider of choice and partner in solutions for the offshore and marine industry.
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