CitySpring, Keppel Infrastructure Trust trading higher on planned merger

KEPPEL Infrastructure Trust (KIT) and CitySpring Infrastructure Trust resumed trading higher on Wednesday, a day after the two announced their merger plans to create the largest infrastructure-focused business trust in Singapore with total assets of more than S$4 billion.

At 9.35am, CitySpring was up almost 8 per cent from its pre-suspension level seen on Friday, at S$0.555 a unit. More than nine million units traded.

KIT was up almost 6 per cent, at S$1.105 a unit, with slightly over a million units changing hands.

Under the proposed merger, KIT unitholders will receive 2.106 new CitySpring units for each KIT unit. KIT will acquire a 51 per cent stake in Keppel Merlimau Cogen, which owns a 1,300 MW combined cycle gas turbine power generation facility on Jurong Island, for S$510 million.

Temasek Holdings, CitySpring's biggest unitholder, will have the second largest stake in the combined trust after Keppel Corp if the deal goes through.

KIT's assets include the Senoko and Keppel Seghers Tuas waste-to-energy plants as well as the Ulu Pandan NEWater plant. CitySpring's portfolio includes City Gas, Singapore's sole producer and retailer of town gas, and SingSpring, the island's first large-scale seawater desalination plant.