Keppel FELS Strengthens Position in Europe

Keppel Corporation Limited, through its offshore rig-building division, Keppel FELS Limited, has signed a preliminary agreement with Verolme Botlek B.V. to acquire an 85% interest in Dutch offshore repair and conversion shipyard, Verolme Botlek for EURO 18.3 million (S$32 million).

The management (10%) and workers' foundation (5%) will hold the remaining interest. Subject to due diligence and definitive agreements, the acquisition is expected to be completed within the next few months.

This acquisition of the shipyard in Rotterdam is in line with Keppel's near- market, near-customer strategy to better serve its customers by being closer to them. It will also give Keppel a stronger foothold in the North Sea and European offshore and marine markets.

Said Mr Choo Chiau Beng, Executive Director of Keppel Corporation and Chairman and CEO of Keppel Offshore & Marine Ltd (Keppel O&M), "Currently, Keppel O&M’s network of shipyards covers the major oil and gas fields in the Gulf of Mexico, Brazil/West Africa, Central Asia, Asia Pacific region and Middle East. With the acquisition of Verolme Botlek shipyard in the Netherlands, our strategic capability to service our customers who are prospecting and drilling in the North Sea will be further enhanced."

The North Sea holds Europe's largest oil and natural gas reserves and is one of the world's key non-OPEC producing regions. Its oil production reached 5.9 million barrels per day in 2001.

"As Verolme Botlek is an operating shipyard with substantial experience both in terms of offshore conversions and repairs, as well as engineering and managerial expertise, we can offer our services immediately to our customers," continued Mr. Choo.

Founded in 1954, Verolme Botlek is a well-established shipyard in the Netherlands, providing integrated services and activities in offshore repair, conversion and modification work. The yard reported a revenue of EURO 132.5 million (S$230 million) and profit before tax of approximately EURO 6.1 million (S$10.6 million) in 2001.

"With Keppel O&M's resources, existing marketing network and engineering strengths, we can grow Verolme Botlek and strengthen its leadership position in the European offshore and marine sectors," added Mr. Choo.

Situated in Rotterdam's Botlek area, Verolme Botlek covers a total area of 54 hectares, and has three drydocks up to 500,000dwt and good workshop and crane facilities. Its location in the Port of Rotterdam offers convenient access to both the North Sea and much of the industrial hinterland of Western and Central Europe. Verolme Botlek will be the latest addition to Keppel's current stable of 14 yards in USA, Brazil, Azerbaijan, Philippines, UAE and Singapore.