Keppel to Raise Stakes in Philippines Shipyard
Keppel is raising its shareholdings in two associated companies, Subic Shipyard and Engineering (SSEI) and Consort (CLI) to boost its Near Market, Near Customer strategy in the Philippines.
SSEI is a leading shipyard located in Subic Bay, the Philippines, which provides repair, conversion and building services to shipowners and offshore operators in the region. It also carries out routine and specialized machinery reconditioning works, as well as steel fabrication for marine and offshore structures. CLI owns 72 ha of land including the 20 ha on which SSEI is situated.
A total cash consideration of approximately S$86.5 million will be made by Keppel to raise its effective stakes from 44% to 83.9% in SSEI and from 33.7% to 38.7% in CLI. The sale and purchase of shares in both companies is expected to be completed by the end of September 2010, following which, SSEI will become a Keppel subsidiary.
Mr. Nelson Yeo, Managing Director (Marine) of Keppel Offshore & Marine and Chairman of KPMI, said, "We have been present in the Philippines for more than three decades, and are continuously improving on the safety, quality and productivity of our yards, as well as equipping them to undertake more sophisticated work to meet the increasing market demand for high value services.
"The move to take a bigger share in the Subic shipyard reinforces our Near Market, Near Customer strategy to enhance the depth and breadth our services to global customers. It also demonstrates our confidence in the offshore and marine industry. As a majority shareholder, Keppel will be in a better position to add value to the Subic shipyard and fortify our offerings to meet the growing needs of our customers."
The above transactions are not expected to have any material impact on the earnings per share and net tangible asset per share of Keppel Corporation for the current financial year.