SINGAPORE - Mainboard-listed Keppel Corp said on Monday (Aug 31) that its subsidiary, Keppel Offshore & Marine (Keppel O&M), is buying the owner of LeTourneau jackup rig designs from Cameron International Corp for US$100 million (S$141 million) in cash.
The company said the LeTourneau suite of jackup rig designs are established designs that have been popular with certain market segments and have a proven track record of operating in a variety of environments.
With the acquisition, Keppel will be able to offer customers the LeTourneau rig designs through the sale of rig kits to shipyards, or deliver ready-to-drill rig solutions from Keppel yards worldwide.
Keppel will also be able to provide more aftermarket services. With about 100 LeTourneau rigs currently operating around the world, many operators require servicing and repair of their rigs. Keppel said it will be able to leverage its network of yards worldwide to better meet these customers' needs. Besides repairs, upgrades and modifications, jackups are also required to undergo five-year class recertification special periodic surveys.
Said Mr Chow Yew Yuen, CEO of Keppel O&M: "This is an opportune and strategic acquisition as it will not only broaden our suite of jackup rig design offerings in this highly competitive sector, but also provide us with enhanced capabilities to service customers through the provision of expanded aftermarket sales and services."
He added: "With the current low oil price, we have seen a slowdown in newbuild rig orders. Rig owners are instead looking at repairing and upgrading their current fleet. We believe that we can make best use of our after sales service infrastructure to service rigs of both the LeTourneau as well as Keppel FELS designs."
Keppel O&M's wholly owned unit, Keppel Offshore & Marine USA, Inc, will fund the purchase with internal working capital.