SINGAPORE - Singapore's Sembcorp Marine has agreed to a multi-billion dollar merger with Keppel Corp's larger offshore and marine unit, a year after the Temasek-backed firms began deal talks to cope with an industry downturn.
The combination "brings together two leading O&M companies in Singapore to create a stronger player that can realise synergies and compete more effectively amidst the energy transition," said Loh Chin Hua, Keppel's CEO and chairman of Keppel Offshore & Marine. As part of the merger, Keppel and its shareholders will own 56 per cent of the combined entity, while Sembmarine's shareholders will own the rest.
Keppel said it would distribute 46 per cent of the merged entity's shares in-specie to its shareholders and retain a 10 per cent stake.Analysts have called for industry consolidation for years. Sembmarine demerged from parent Sembcorp Industries in 2020, helping pave the way for the Keppel deal.