Carrying value of Keppel's investment in Floatel to increase to S$284m

BASED on Floatel International's financial results for Q4 2020 and Q1 2021, the net financial impact on BN4 will be around S$187 million, the mainboard-listed conglomerate said on Friday night.

As a result of equity accounting, the carrying value of Keppel Corporation's investment in offshore vessel company Floatel will thus almost triple to about S$284 million, from some S$96 million as at Dec 31, 2020.

The carrying value of this investment will be re-assessed for recoverability at the end of each financial reporting period.

Floatel, which recently completed its corporate restructuring, on Friday reported a US$551 million net profit for the first quarter of this year, including a restructuring gain of some US$578 million.

Keppel said it will equity account for these Q1 results amounting to about S$241 million, including its estimated S$269 million share of the restructuring gain.

As for Q4 2020, Floatel recorded an additional impairment of its vessels of around US$81 million. Keppel will also equity account for this, amounting to about S$54 million.

Under the consensual transaction for Floatel's restructuring, Keppel's wholly-owned subsidiary FELS Offshore retained its 49.92 per cent stake in Floatel and forgave a US$244 million loan.

Separately, Keppel Corp on Friday announced Keppel Land units will jointly develop eight plots of land in Tianjin with subsidiaries of Hong Kong-listed Sino-Ocean Group.

Shares of Keppel Corp fell S$0.08 or 1.5 per cent to close at S$5.42, before these announcements.

READ MORE:

• Keppel-linked Floatel gets US$100m loan from Temasek's Clifford Capital amid restructuring
• Keppel Land subsidiaries enter JV with HK-listed Sino-Ocean Group