Keppel Corp's planned 2.9 billion yuan (S$595 million) disposal of its stake in a China marina development remains stonewalled as the project's minority shareholder continues to try to block the deal.
Keppel told the Singapore Exchange in a filing yesterday that the Singapore High Court has approved an application by Sunsea Yacht Club (Hong Kong) to stop Keppel from completing the sale, pending Sunsea's application with the Court of Appeal.
Sunsea has a 20 per cent stake in a joint venture with Keppel that is developing Keppel Cove, a residential and marina project in Zhongshan city in China. The remaining 80 per cent is held by Keppel China Marina Holdings, which Keppel Land China is trying to sell to Hong Kong-listed Logan Property.
Sunsea started legal action to block this sale last month. It was reported earlier that Sunsea is understood to be seeking to restrain the completion of the divestment in the light of an alleged breach of contract on Keppel's part.
On Dec 15, the High Court dismissed Sunsea's summons for interim relief to prevent the sale from happening. On Dec 22, Sunsea sought permission to appeal against this ruling, but was denied by the High Court and ordered to pay costs.
But Sunsea told the High Court it planned to go to the Court of Appeal over the Dec 22 decision. The High Court has therefore allowed an application by Sunsea to restrain Keppel from completing the divestment until Sunsea's application with the Court of Appeal is addressed.
If the deal goes through, Keppel Land China, a wholly owned unit of Keppel Land, would be able to recognise a gain of about $290 million.
Keppel said in yesterday's statement that Keppel Land China will work closely with its lawyers to expedite the disposal of the application to the Court of Appeal.
Separately, Keppel said on Monday that it has clinched a government land tender to buy a prime 18.03ha residential site in Wuxi, China for 2.53 billion yuan.
A Keppel Land China unit plans to develop the site - with a gross floor area of about 360,500 sq m - into a residential project with 2,053 high-rise, 456 mid-rise and 246 low-rise units. The site is 5km from Wuxi's downtown area.
"With Wuxi's strong economic growth and positive residential market outlook, coupled with the prime location of the site in close proximity to amenities, we are confident that the new residential development will receive strong demand from home owners, " Keppel Land chief executive Ang Wee Gee said in a statement.