Keppel Corporation Limited (Keppel) announced today that it has signed revised agreements with Sembcorp Marine on the proposed combination of Keppel O&M and Sembcorp Marine, changing certain commercial terms and the transaction structure, which would simplify implementation, provide greater deal certainty and accelerate the completion of the transaction.
Keppel also announced that it has signed revised agreements with Baluran Limited (Baluran), an indirect wholly-owned subsidiary of ASM Connaught House Fund V, and Kyanite Investment Holdings Pte. Ltd. (Kyanite), an indirect wholly-owned subsidiary of Temasek, such that the proposed combination and Asset Co transactions will be delinked, and the Asset Co transaction will proceed regardless of the outcome of the proposed combination of Keppel O&M and Sembcorp Marine.
Final revised commercial terms and transaction structure as follows:
Proposed combination
Proposed combination now structured as acquisition by Sembcorp Marine of Keppel O&M.
Sembcorp Marine will be the “Combined Entity” owning, post acquisition, a combination of its current business and Keppel O&M
Exchange ratio between Keppel and Sembcorp Marine revised from 56:44 to 54:46 respectively.
Combined Entity shares in Keppel’s segregated account for contingent liabilities reduced from 10% to 5%; released Combined Entity shares to be distributed to Keppel Corporation shareholders.
Asset Co transaction
Asset Co transaction will no longer be conditional upon outcome of the proposed combination and will proceed regardless of whether Keppel O&M is acquired by Sembcorp Marine.
Keppel’s coupon from vendor notes has also increased from 2% to 4%.
· Updated transaction structure simplifies implementation of the proposed combination, provides greater deal certainty and allows faster completion
Acquisition requires majority approval of both Keppel’s and Sembcorp Marine’s shareholders; no Court approval required and no transfer of listing status from Sembcorp Marine to a separate Combined Entity.
Parties are targeting to complete the proposed combination by end-2022.
· Keppel Corporation shareholders to receive new Sembcorp Marine shares representing 49% of its enlarged share capital, estimated to be 19.1 Sembcorp Marine shares per Keppel Corporation share.
