General – Merger
Sembmarine has agreed to combine with local conglomerate Keppel Corp’s larger offshore and marine (O&M) unit, a year after the Temasek-backed firms started deal talks to cope with an industry downturn.
“The combined entity will be well-positioned to capture opportunities arising from decarbonisation in the oil & gas sector and from the global energy transition towards renewables, particularly in the areas of offshore wind, and new energy sources,” the companies said in a joint statement today.
Sembmarine and Keppel Offshore & Marine, one of the world’s largest offshore oil rig builders, have suffered from a prolonged and severe sector downturn over many years. A surge in oil prices has partly improved the industry outlook.
Once the merger is completed, Keppel and its shareholders will own 56 per cent of the combined entity, while Sembcorp Marine’s shareholders will own the rest. Keppel will distribute in-specie 46 per cent of the merged entity’s shares to its shareholders and retain a 10 per cent stake.
Singapore state investor Temasek, Sembmarine’s majority shareholder, will become the largest shareholder in the combined company with a 33.5 per cent stake.
Sembmarine was valued at S$4.1 billion as of Tuesday’s closing price.
JPMorgan is the financial adviser to Keppel on the deal, while Credit Suisse is the financial advisor to Sembmarine.