Keppel plans to reward shareholders with part of monetisation cash, including from M1 sale

SINGAPORE – Global asset manager and operator Keppel said in its third-quarter business update that it intends to reward shareholders with part of the cash unlocked from ongoing asset monetisation efforts.

However, chief executive Loh Chin Hua stopped short of confirming whether this reward would come in the form of a special dividend, in a call with analysts and the media on Oct 30.

He also said the company is committed to paying sustainable and growing dividends, anchored to the earnings of its core businesses, or what the company terms as “New Keppel”.

Keppel shares rose as much as 1.4 per cent to $10.03 on Oct 30 shortly after the announcement. The stock pared gains and was up 0.5 per cent at $9.94 at the midday trading break. The shares ended the trading day 1.6 per cent higher at $10.05, a new record.

New Keppel excludes mainly legacy offshore and marine assets, its residential land bank, selected property developments and investment properties, hospitality and logistics assets, associated cash and receivables and other non-core investments.

It also excludes M1’s telecommunications business, which has been recorded as discontinued operations pending Keppel’s sale of the business to Simba, which is awaiting regulatory approval but is said to remain on track to be completed by end-2025.

Keppel reiterated on Oct 30 it does not expect the outcome of legal proceedings on Liberty Wireless’ mobile virtual network arrangements with M1 to adversely affect or delay sale completion. Liberty Wireless is the parent company of Circles.Life.

Net profit for New Keppel, which excludes its non-core portfolio for divestment and discontinued operations, rose by more than 25 per cent year on year for the nine months ended Sept 30.

Keppel said the strong results of its core operations were underpinned by earnings growth across all three business segments – infrastructure, real estate and connectivity. It noted that the non-core portfolio for divestment achieved a net profit, reversing its net loss from a year ago.

Bottom-line net profit for the nine-month period rose more than 5 per cent even after including accounting loss from the proposed divestment of M1’s telco business, “underscoring the resilience of the New Keppel’s business”, the company said. Keppel does not disclose financial figures in its voluntary first-quarter and nine-month business updates.

The group recorded close to 15 per cent year-on-year growth in recurring income, bolstered by higher contributions from both asset management and operating income, for the first nine months of 2025.

Keppel said the company is targeting more than $500 million in monetisation deals “over the next few months”, adding to a total of about $14 billion already announced over the last five years.

This includes the monetisation of about $2.4 billion in assets, including the proposed divestments of M1’s telco business and Keppel’s interests in waste management firm 800 Super.

Keppel also announced that dividend payout will be based on New Keppel’s annual net profit.

The company has repurchased $92.6 million worth of Keppel shares as at end-September, after the launch of a $500 million share buyback programme on July 31.

From January 2022 to September 2025, Keppel returned $6.6 billion to shareholders via cash and in-specie distributions. This translates to annualised total shareholder returns of 38 per cent, more than double the Straits Times Index’s 14.5 per cent, the company said.

“Keppel is committed to a steady and sustainable dividend strategy that reflects the earnings performance of the New Keppel, with the final amount subject to the discretion of the board.

“As Keppel’s earnings profile becomes increasingly stable and recurring, the company aims to provide shareholders with consistent and steadily growing cash returns, while maintaining prudent capital allocation to support growth and an efficient capital structure.”

In the first nine months of 2025, Keppel generated $299 million in asset management fees and completed approximately $7.6 billion in acquisitions and divestments at its fund management and investment platforms.

Keppel’s private funds added $6.7 billion to funds under management in that period, it added.

While Mr Loh did not reveal the total funds under management, he said that as at the end of September, they were higher than at end-June.

A further $1.4 billion in new real estate and digital infrastructure acquisitions from Keppel’s listed real estate investment trusts and infrastructure trust will be progressively added to funds under management. Keppel also said it has a deal pipeline of about $35 billion, with more than half in the infrastructure and connectivity segments.

Several analysts asked Mr Loh if Keppel would continue with its buyback given the rise in its share price. To this, Mr Loh said: “Rather than (issuing) shares, we believe this is a good time to buy shares from the market and keep (these) as treasury shares.” Treasury shares can be disbursed in employee share plans or used for merger and acquisition transactions.

Ms Cindy Lim, chief executive of Keppel’s infrastructure division, said its decarbonisation and sustainability solutions business is on track to meet the earnings target of $100 million on a recurring basis under long-term contracts in 2025.

Responding to a question on Keppel’s capabilities to develop nuclear power in view of stepped-up government study into the field, Mr Loh said the company is keeping abreast of developments.

He expressed hope that Keppel “can play a useful part in helping the Government go into nuclear power”, should the time come.