SINGAPORE - The delay in announcing the combination of Keppel Offshore & Marine (O&M) and Sembcorp Marine is due to the complex nature of the transaction but a statement will be made soon, said Keppel chief executive Loh Chin Hua at a briefing on Thursday (April 21).
He added in reply to an analyst’s question about the delay: “We are now nearing the timeline and there is no need to dwell on the details at this point.
"We are getting to the stage where we are dotting the i's and crossing the t's."
The merger is expected to create a global energy giant with increased operational scale, a broader geographic footprint and the enhanced capabilities that come with a larger entity.
The shares Keppel receives in the combined entity will be distributed in specie to its shareholders.
In tandem with the merger, Keppel is also looking to sell Keppel O&M's legacy rigs and associated receivables to a separate company that will be majority-owned by external investors.
An announcement on the deals will likely be made within the next 10 days.
The proposed transactions are in line with Keppel's plans to be more focused and disciplined as it executes its mission to provide solutions for sustainable urbanisation.
Mr Loh, who was speaking at a briefing on Keppel's first quarter, noted that net profit for the period was higher than for the same three months last year, with improved performance in energy and environment, connectivity and asset management.
All key business units apart from Keppel O&M were profitable, but Keppel O&M significantly reduced net loss and was Ebitda (earnings before interest, tax, depreciation and amortisation) positive.
However, Keppel Land's quarterly net profit was lower year on year due to reduced contributions from China property trading projects and the absence of collective sales.
Keppel does not disclose quarterly profit numbers.
Revenue was 9 per cent higher at $2.1 billion for the three months to March 31, underpinned mainly by the energy and environment unit.
Mr Loh said that since the launch of the group's asset monetisation programme in September 2020, it has announced more than $3.2 billion in asset sales and received about $2.8 billion of this amount in cash.
The firm has announced $332 million in asset monetisation so far this year, including offloading its interests in Keppel Logistics.
The restructuring and reorientation will ultimately make Keppel a conglomerate engaged in sustainable investment, development and asset management.
It is also looking at property, infrastructure and "any investment which will produce good cashflow".
While the company lost out on acquiring Singapore Press Holdings, Mr Loh said Keppel Corp is looking at “quite a number of potential (mergers and acquisitions)” in various growth areas.
He added that the firm is in a good position for growth. "We got off to a good start despite a challenging environment. We do see quite a lot of opportunities which we look to exploit."