Halted shares of Sembcorp Marine, parent in focus in Singapore

[SINGAPORE] Shares in Sembcorp Marine (Sembmarine) and Sembcorp Industries (SCI) remained halted for a second day on Friday, prompting speculation among some analysts about a potential deal between the Singapore rigbuilder and its parent company.

"Given the concurrent nature of the trading halts, we believe that any announcement would involve a form of transaction between the two companies," analysts at Citi said in a report.

Both Sembmarine and SCI declined to comment.

Sembmarine's shares closed up 17 per cent at S$0.725 on Wednesday, giving the company a market value of S$1.78 billion. Its shares have lost 36 per cent this year.

Meanwhile, SCI shares finished Wednesday at S$1.53, up S$0.07 or 4.8 per cent.

State investor Temasek Holdings-backed SCI owns a 61 per cent stake in loss-making Sembmarine.

It has been viewed as a privatisation or divestment target for the last few years due to a prolonged downturn in the rig-building sector.

Temasek's bid last year to buy control of conglomerate Keppel Corp, which owns an offshore and marine unit, boosted expectations of consolidation in the local rig building sector.

Earlier on Friday, Sembmarine said its Brazilian subsidiary had entered into a revolving facility agreement for up to US$500 million. A condition in the agreement says terms would have to be reviewed if SCI ceased to be the company's majority shareholder.

REUTERS