SINGAPORE: Keppel Corp and Sembcorp Marine have agreed to explore a potential combination of Sembcorp with Keppel’s offshore and marine business.
“The objective of these discussions is to create a stronger combined entity and sustainable value over the long term for Keppel O&M and Sembcorp Marine and their respective stakeholders, in response to dramatic changes in the global offshore and marine engineering and energy sectors,” the companies said in a joint press release on Thursday .
READ: Commentary: Keppel’s exit of rig business may have bigger implications for Singapore's offshore and marine sector Keppel is one of the world’s largest offshore oil rig builders. Sembcorp also announced a S$1.5 billion fully committed rights issue. The statement said Keppel and Sembcorp will “undertake mutual due diligence and discuss the terms of the potential combination, which is expected to take several months".Both companies said in the joint press release that they will provide further updates in due course and emphasised that discussions are at a preliminary stage and that"there is no certainty that the potential combination will take place".